Latest Posts

In any typical warehouse, picking and packing are no doubt the most
essential activity, and it plays a very great role in customer
satisfaction as well as in analyzing the overall supply chain
performance. Pick and pack warehousing is part of the entire management system of a supply chain commonly used in product distributions
There are various picking and packing plans and one of the best and
recommended is the eco-friendly green warehousing plan. It costs nothing
more than regular shipping methods but it has more healthy and safe
picking and packing solutions. For one to realize a greener and
eco-friendly pick & pack warehousing strategy, they should ensure
that they:

Use eco-friendly transport

This should be preferable via ocean transport for oversea
distributions or via eco-friendly freight rail if possible. For local
distribution, consider rail transport since more than 90% of domestic
pollution comes from vehicles while rail is responsible for only 0.6%

Use intelligent lighting

This includes incorporation of sensors, which reduces power
consumption in as much as 10%. You could also prefer solar energy which
provides natural, safe and eco-friendly energy and lighting.

Store in natural aerated rooms

Ensure that the products relax in facilities that are naturally
ventilated or if not possible ones that are powered by green power; more
specifically wind power. This reduces the amount of carbon dioxide from
most power sources that finally contaminate the products. A megawatt of
wind energy has over 2600 fewer tons of carbon dioxide.

Use forklifts that don’t emit carbon monoxide or other noxious emissions

Most forklifts are powered with propane, which poses a risk since it
gives off fumes that sink into the packaged material thus contaminating
them.

Use recycled and eco-friendly packaging boxes

Fresh and eco-friendly boxes will always ensure that the product is
safe, while recycling saves cutting down of trees and at the same time
reduces waste thrown around.

Use 100% recycled paper to make the packing slips

This reduces the amount of natural resources used up and reduces the amount of chemicals used in the process.

Electronic invoices

Instead of using paper for invoice, prefer electronic invoices to
save on the paper used. This is eco-friendly since it reduces trees
wastage.

Use green tape for securing your packaged boxes

Keep your products safe and secure in the boxes by using recycled
security tapes. They reduce the amount of waste thrown around thus
keeping the environment clean.

Prefer automated methods for moving products

The more you move products about manually, the more they get
contaminated with dust and other gas pollutants. However, with a
conveyance belt, you can move them about easily and safely.

Use a green roof

Incorporation of a living roof in the warehouse or workplace is not
only a wonderful experience but also a better way of saving energy. It
reduces indoor temperatures by up to 4 degrees thus saving on energy
used up by fans and other cooling devices.
Embracing a green pick and pack warehousing plan is a great way to
take care of our planet as well as ensuring that your consumers receive
safe and uncontaminated products.

Nowadays, you’d be hard-pressed to find too many people that don’t
own a smartphone of some kind: almost everyone seems to be carrying an
iPhone, Android or Windows phone. And, on their phone, they’re sure to
have countless apps, from social media to banking, games to emails. And
retail companies are reaping the rewards, too, with dozens of the
country’s biggest names like Asos and John Lewis each with their own app
offering a new way to browse products and make purchases. This article
takes a look at how mobile is one of the best platforms for commerce,
and how you can cash in on it.

What’s it all about?

For a few years now, mobile apps have been gaining momentum as one of
the leading platforms on which sell products. The inception of apps
started with the launch of the iPhone back in 2007, but only in the last
few years has the true retail potential of the app been realised.
And it’s not only apps where mobile sales have been increasing. The
majority of large companies, whether retailers or not, have optimised
their website for mobile; what this means is that viewing their website
on the small screen of a mobile phone shows a different, more
streamlined site, making it easier to see the content and ultimately
more appealing to look around and buy something.
All this has led medium and small businesses to think about how they
can get involved with mobile. There’s clearly money to be made in the
placing your products quite literally into the palm of a customer’s
hand, and more and more companies are realising it.

How can you take advantage and gain more mobile sales?

As it stands, you have a website. This website may or may not be
optimised for mobile – if it isn’t, then to do so requires editing the
code that the website is built on. If you have an agency that runs your
site then get in touch with them first. Or, if you run it yourself, a
quick Google should help you understand what needs to be done.
Now, onto the subject of the app. Apps are built by Developers
(digital builders), and can require a lot of testing and development. In
order to create an app for your venture, the best thing to do would be
to get in touch with a digital agency or app developer – sometimes, this
is the same company that runs your website. They should be able to
offer you a quote for building and maintaining your app., and talk you
through the process of designing, building, testing and launching your
new ecommerce platform.

A final word

There’s no question that creating an app for your ecommerce business
is the right way to go. A well-built app will allow customers to
purchase goods directly through it and change your stock levels
automatically. This data can then be sent to your pick and pack fulfilment provider
who will ship the products to the paying customer. Apps and the sales
they provide will only continue to grow, and failing to get on board at
the right time could see your business lose out.

Choosing to try new approaches to reaching new customers is a big step
to take: it often involves a great deal of research into that approach
to find out its strengths and weaknesses, to see the true results that
it can give. When it comes to mailing campaigns, that’s no different. A
mailing campaign is a method that quite literally puts your company and
the services it can offer on the doorstep of a potential customer, so
its little wonder that time after time, London businesses see the value
of these types of campaigns. In this post, we take a look at how a
fulfilment company can help you grow your business using a campaign of
this type, and unpack what a mailing campaign entails.

Fulfilment companies are here to help

Fulfilment companies specialise in providing businesses solutions to
the distribution of their goods. Their work is varied, but often
involves larger-scale pick and pack fulfilment, in which items are
distributed to customers in a range of order sizes, but can also involve
distribution of another type: marketing material. In this case, the
fulfilment company’s offer to your business becomes not about getting
your goods to your customers, but getting you to customers.
The mailing campaign service that a fulfilment company can provide
is large-scale and tailored to the geographical areas you believe will
yield the highest quantity of new custom. It involves providing entire
areas with material that explain who you are and what you can offer your
customers, all in a professional, efficient manner. It takes the
pressure off from your shoulders, too, as a key piece in marketing your
business to the city of London is done for you, leaving you time to
focus on growing your business.

How can mailing campaigns help your business?

As with any new approach to add to your business, it’s worth
understanding as much as you can about that approach. When it comes to
mailing campaigns, though, there isn’t as much as you might expect to
get your head round. The method of reaching potential customers through a
mailing campaign rests on the impact of volume. What we mean by this is
that the more published material you deliver, the higher the number of
new clients to your business. This is, of course, due to the simple fact
that more people will see your business and the benefits you can bring
to them.

In addition to this, though, there are things that can be done to yield
even greater numbers of new customers through a London mailing campaign.
One of these is in the material itself: it’s all about making the item
that your potential customer sees as eye-catching as possible. Make it
stand-out from everything else they’ll read that day, and really pick
out the highlights of what your business can offer.

The other major practice to maximising your chances of new customers is
employing a professional fulfilment service to perform the mailing
campaign for you. And that’s something we can help you with.

Any good fulfilment company
will do their utmost when transferring goods from one customer to
another. They are aware that first impressions count, and that no matter
how excellent the product is, the memory of how it was delivered will
remain in the psyche of the client long after the product has perished
or died.

If you run an online shop and are looking to deal with the picking and packing and posting of goods here are a few tips for you

You can help ensure that your parcel arrives in the same state that it was when you last saw it.

Put Yourself in Their Shoes

Whether you own a small business or are part of a large concern, the
wisest course would be for you to put yourself in the shoes of your
buyer. How would you like to receive your package?

Fold, Roll or Bundle

This all depends on the item of clothing, together with your personal
choice. For T-shirts and trousers you would fold, then roll, whereas
socks you might just want to fold them together and not bother with the
roll.

Fragile, Handle with Care

Put heavy items at the bottom. Seems a no brainer, but you’d be surprised at how many people don’t do this.

It is all very well writing “FRAGILE, HANDLE WITH CARE” on your
parcel, but once it is out of the hands of the individual and in a mail
bag or package cage your goods can tend to be knocked around by other
parcels. It’s best to pack them securely to start with.

If you are sending crockery or glass, be sure to wrap each item
individually with bubble wrap. Otherwise, even if they don’t break, they
can chip each other.

Double up on the containers.

Try to use a corrugated box for the outer container.

Bubble wrap is an excellent commodity to surround the inner container.

Sharp & Dangerous

Items
This is where the reinforced packing tape comes into play again. If
you are exporting anything sharp like knives, wrap them tightly with
bubble wrap and use plenty of the tape until you cannot feel anything
sharp and feel sure that the item won’t protrude through.

Delicate Items

Items such as picture frames and mirrors can be easily crushed in
transport. Make sure that you protect the front and back with corrugated
cardboard and that it is larger than the item. Put bubble wrap or cloth
between the glass and the cardboard. This will reduce pressure,
preventing breakages.

Perishable Items

Things like food should be transported in paper maché trays. Again,
we suggest you use corrugated cardboard for the outside. As with the
fragile items these foods and such should be labelled as perishable
goods.

Fulfilment companies such as ours specialises in the safe deliverance
of products on behalf of their customers so if all the above seems like
too much to handle for your company, then why not consider outsourcing
your order fulfilment to a company with expertise in this area.

As we all know, outsourcing the warehousing and distribution
end of your business can yield fantastic results for your business.
Finding professional logistics services that can take your supply chain
to the next level will only serve to improve your customer service,
keeping your buyers loyal in a marketplace that is becoming increasingly
competitive. In this article, we take a look at some of the dangers
that online businesses large and small face, and the solutions that can
be put into place to combat them.

Major danger number 1: Getting stung by undercutting competitors

The first potential threat to your business comes in the form of your
competitors’ approaches to pricing. It’s a buyer’s market, and your
competitors know it. That’s why they’ll often set their prices just
lower than yours in an attempt to undercut you, giving you a couple of
options: you can choose to lower yours, too, but the downside of this is
the decrease in your margins.

The true alternative to this approach is offering your customers greater
customer service for the money they’re already paying, i.e. more for
their money. When it comes to online retailing, though, there aren’t
many ways of doing this: one is to ensure your website is up to scratch.
Perhaps more importantly, though, is perfecting the distribution of
your products to your customers. To do this, think about your current
offer: are you providing multiple delivery options, such as Next Day or
collection from a Customer Collect location? Remember, everyone has
different needs: some customers want their goods ASAP, others are happy
to wait. Talk to your Pick and Pack service provider to see what
customer delivery options are available for you to offer or visit www.fairwaypsd.com

Major danger number 2: Mastering social media for your online shop

The second threat we’ll talk about is all about marketing what you can
offer in the most attractive way possible. Failing to do so undoubtedly
leads to falling sales, giving your competitors the edge. This doesn’t
mean you have to spend heavily on a professional PR and Marketing
service, though. These days, the tools for effective promotion of your
goods and communication with your customers are quite literally at your
fingertips, and you’ve probably been using them in some capacity for
years. We’re talking, of course, about social media.

Social media is divided into a number of separate platforms, such as Twitter,
Facebook and Instagram. These platforms are used by businesses of all
sizes across the globe to reach their customers and promote their
products in many different ways. Take a look at some large companies and
their social media and you’ll notice some common themes: simple,
powerful messages.

Keeping it basic is key: talk about the products you offer in
easy-to-understand, friendly ways. Promote what sets you apart from the
rest, whether it’s the quality of your products, a compelling company
story or the great customer service you offer. And make sure you promote
your efficient distribution service: nobody wants to find an exciting
new retailer through social media only to discover the products they
want aren’t available when they need them.

Providing efficient distribution can often be the deciding factor
between customers that return and those that don’t. Getting fulfilment
right every time is a must for online selling. Follow our golden rules
to online trading and you’ll be making sure those customers buy from you
again and again.

Distribution revolution

Some customers are content with receiving their items a week after they
buy; some want them the very next day. Providing a number of delivery
options (and the prices to match) means that you’re catering to even
more of your customers’ needs.

Checking in

When an order arrives from your supplier, it’s easy to make mistakes
with checking the products in. For a professional fulfilment service,
though, that’s no concern. With an experienced team, numbered stock
locations and a reliable stock management system, checking-in mistakes
can be a thing of the past.

Lay waste to wastage

One major headache for retailers is losing stock through theft and
loss. Keeping your goods in a secure location is one of the most
important safeguards to make. Pick and pack firms offer such security as
part of their service – your items, stored in a secure fulfilment warehouse, remain there until a customer orders them.

Keep in touch with your customers…

Bring your customers into the fold with regular email communications.
Keeping them up-to-date with new products, promotions and news will
keep their interest, and provide valuable marketing data to find out
who’s actually buying your stock.

… but don’t forget to say ‘thank you’

Reward your customers’ loyalty with a promotional code every now and
then. If your customers are signed-up to regular communications, think
about giving them a one-off discount as a reward and your business a
quick boost in sales.

Worldwide shipping

With the internet available on just about every corner of the planet,
you don’t want to miss out on potential customers who want to purchase
your products but can’t due to restrictive distribution. Get those goods
available to them through offering international shipping.

Discounting down the days

Retailers know the time of the year their customers expect to find a
cut-price sale. Give your customers a nice surprise with a short-term
‘flash’ sale – it’ll clear that leftover stock, increase brand loyalty
and set your sales on the increase.

Get the logistics of your stock right

To keep customers happy, the products they need have to be available
when they need them, meaning your supplier needs to be on the ball. So,
keeping supply chain management as efficient as possible is top of the
agenda. Getting your stock delivered straight to a fulfilment centre for
storage and distribution saves time, and your customers get the
products they need as fast as possible.

Trust is difficult to build, but easy to lose

Just like your customers trust you to deliver the products they need,
you can trust a professional pick and pack service to get your products
to those customers when they need them. Getting that bit right is
something that Fairway Fulfilment & Logistics can assist with.

Christmas is coming! Good supply chain management now can prevent
the problems so many ecommerce merchants had last holiday season

Much ink has already been spilled over the delivery-by Christmas
debacles, both the embarrassing high-profile disasters in the US, and
the less notorious but more personally damaging failures here in the UK.
Nonetheless, it is time for those of us in supply chain management to ask ourselves what we will actually be doing differently this year.

Investments some companies have already made in supply chain management

Both large and small operations, both merchants and fulfilment
companies, have made significant investments in supply chain management
in order to deliver credible claims of fast, reliable delivery of last
minute Christmas gifts. Some of the more common changes include:

Upgrading communications and call centre capability, both in-house
and outsourced, especially ensuring that customers have reliable and
fast access to the status and current location of their orders.

Increased automation of existing distribution facilities and assets, or expansion of their facilities.

Planned outsourcing of certain segments of their fulfilment for the
duration of the holiday rush – essentially adding extra temporary
capacity.

Planned ‘pop-up’ distribution or call centre facilities and temporary employees for short-term use

What supply chain management professionals can expect from the 2014 season

Many have cited the compression of the 2013 holiday season as part of
the problem. It was a mere 26 days, after all. That does not mean that
it will not be a problem this year. The 2014 season is short as well,
only 28 days, and those extra two days of capacity are likely to be
taken up by the increase in demand most merchants expect.

Much of the debacle last year was simple bad supply chain management –
failure to get orders out the door in time, and over-committing
resources by several parties in the chain. This year, it is hoped, we
have all learned to say ‘No, we can’t deliver another order on time, and
we are unwilling to try’. Still, expect some disappointments, and make
sure all of your suppliers and carriers are on board with the realistic
strategy. It only takes one bad link after all.

Ecommerce is a very competitive industry, and nine times out of ten a
new customer will pick the least expensive provider of a good or
service, regardless of any other factors. Order fulfilment, and specifically pick and pack
can be responsible for a lot of your overhead, and making efficiency
advances there could help your overall profitability quite a bit.

Kitting can improve your pick and pack performance and reduce costs

Kitting is essentially bundling certain items together before hand, and assigning a single SKU
to the new ‘kit’. Of course this relies on having accurate order
predictions, but if you know that a substantial number of orders that
include Product X also contain Products Y and Z, your pick and pack
people can use slow periods, night shifts, or other less in demand time
to pre-bundle a portion of your inventory together.

The kit can be packed as part of a larger order, or shipped as is with
only the addition of a label, depending on how you choose to package it.
Kitting has been shown to improve the efficiency of both in-house and
outsourced pick and pack operations. Many suppliers will even kit items
before delivery to you, for a small fee.

The ‘pack’ half of pick and pack is too often overlooked in terms of
efficiency efforts. Efficient packaging is a balance between the
flexibility of large boxes, and the added costs of shipping empty space
and bubble wrap.

At a minimum, you should review your packaging decisions every year, and
perhaps more often. Shifts in buying patterns, discontinued product
lines new pick and pack options could make your current system
inefficient, or provide newer, better systems at any time.

Make sure you address the purchase cost of your materials as well as the
transport inefficiencies. It may still be more efficient overall to buy
and ship 10,000 large boxes than 5000 large, 4000 medium and 1000
small.

Every Fulfilment Warehouse
feels the pressure to improve efficiency and service, and to streamline
operations as much as possible. Often when it is time to expand
operations, managers begin to consider bringing in a LMS to help them
keep track of the performance and statistics of larger numbers of
warehouse workers without adding more managers.

At what point does a Fulfilment Warehouse need a LMS?

The first sign that you may need to automate your labour management more
extensively is that you have trouble keeping tabs on your workers
individually. A LMS lets you define the metrics most important to your
fulfilment warehouse or other facility, and which are most central to
your own management philosophy. It can them put that information at your
fingertips, either on a department or individual employee level.

Many fulfilment warehousing or merchants who support their own
distribution centres look to LMSs when they take their first steps into
omnichannel marketing or ecommerce. It just becomes too expensive, in
terms of time and wages, to track performance data manually. The LMS
then frees up the manager’s time for strategic and direct personnel
management.

How can Fulfilment Warehouse managers take best advantage of a new LMS?

Much depends on the size of your operation, and the extent of automation
you need. Ease of implementation is by far the most important
consideration, though. An extensive LMS involves a massive paradigm
shift for even a small operation.

Many merchants instead opt to hand their entire fulfilment warehouse
function over to a 3PL or fulfilment partner who has an established LMS
already operating, and who can easily link it to the merchant’s own
systems. Often, the expertise they bring to the table is worth as much,
or more, than the reduced price per order most offer.

Logistics management refers to the process of planning, executing,
controlling efficient, effectual flow and warehousing of goods, services
and associated information from the place of origin to the place of
consumption with an aim of meeting the customer needs. When you let
another person, specialised in logistics offer these services, it is
termed outsourcing logistics.

Why consider outsourcing logistics?

There are a number of benefits that businesses can reap by outsourcing
the supply chain management to a third party logistics. Third party
logistics provides an all-in-one solution as far as assembly packaging,
warehousing, and distribution of goods are concerned. Making use of
third party logistics offers your business with dependable vantage
logistics leading to optimization of profit integrating resources and
knowledge. These benefits include:

Vast resource network: the extensive network offered by
third party logistics services is advantageous compared to the in-house
supply chains. With this resource network, each of the supply chain
steps is carried out efficiently and cost effectively leading to lower
overhead costs.

Optimized services: these logistics service providers
have all the resources needed to fine tune each link in the supply chain
or even restructure the whole supply chain. Using technology and the
resources at their disposal, they ensure that an appropriate amount of
goods are transported to where they are required effectively,
efficiently and in a cost effective manner within the shortest time
possible. The highly advanced management software these logistics
service providers use is capable of analyzing and monitoring the entire
process which helps to detect and remove any inefficiency so as to
streamline the supply chain- this amounts to a constantly improved and
optimized logistics.

Saves time and cuts costs: employing services of a
third party logistics company saves the time you would have taken to
execute the supply chain yourself; this time can be used to do other
things for the improvement of your organization. It also helps you save
money meant for warehousing, transportation, and the personnel to
execute the logistics process. It also eliminates the issues of
paperwork, auditing, billing, training and most important, the
optimization necessary for your goods to reach where they are required
in a timely and efficient manner.

Flexibility and scalability: with the third party
logistics services, you do not need to be worried especially if your
business is seasonal having its low and high seasons. This is because
you can scale for warehousing space, transportation and other logistics
in accordance to the need at the moment, that is, scale upwards during
the business’ high season and downward during the low season.

Reaching new markets: these services enable your
business to grow into new markets. With their distribution centre and
warehouses placed at strategic places to enhance swift shipping of goods
to any part of the world, reaching out for new markets and growth of
your business is made possible.

Omnichannel sales demand an efficient order fulfilment process, and your pick and pack operations
are one of the most important parts to optimise. Making the jump to an
automated pick and pack process can increase the volume each picker can
handle dramatically. No automated system can yet replace all of your
pick and pack workers, but the best can make them much more effective.

Most pick and pack workers spend 90% of their time walking or searching

That leaves only 6 minutes per hour of actually picking and packing. A
top of the line automated assistance system can cut the walk and search
time of each employee to 24%, and improve their actual work output some
250%. How much is the other 2/3 of your workforce costing you?

The flowthrough of your pick and pack process could be 500% what it is
now without adding more employees of the space they take up – but volume
isn’t the only improvement. Automation systems such as bar code
scanners, advanced information displays ad pick to light systems can
improve the accuracy rate of your pick and pack employees to as much as
99.99%. Better still, the presence of automated resources can remove the
need to bring in as many temporary people over the holiday rush.

Gain the advantage of an automated pick and pack system without the investment by bringing in a fulfilment partner

Many businesses will not feel that this is the time to be making large
investments in automates pick and pack processes or other logistics
programs. In fact, many are divesting more and more of their logistics
function to 3PLs. These companies may actually be faster to respond to
the needs of omnichannel sales because they can seek out a 3PL who has
already made these changes.

No matter how retailers gain access to automated pick and pack solutions, the competitive advantage is clear.

The ability to provide an early delivery date is one of the biggest
factors in providing customer satisfaction. In the most recent UPS Pulse
of the Online Shopper survey, fully half of online consumers have
cancelled an order at the ‘shopping cart’ stage if there were no timely
delivery options available or if no solid delivery date was available on
the website. Delivery time is central a factor of customer
satisfaction, and had become the most important ‘deal breaker’ for
online sales. Worse still, 27% of those polled said that a late delivery
was likely to stop them from using that retailer again.

Your London order fulfilment partner’s role in achieving timely delivery

Many retailers’ first instinct is to look to their carrier to ensure
fast and reliable shipping. While it is true you need a good carrier,
finding a better order fulfilment partner in London may do you a lot
more good. A desirable order fulfilment partner will become invested in
your businesses’ success and vision. Furthermore, their specialisation
should give you the fast and reliable delivery options you need. As your
company grows, your third party logistics provider should be able to
scale up as well. Just keep in mind that not all London order fulfilment providers are created equal.

Capabilities to look for in an order fulfilment provider in London

Flexibile Processes

Even with a location in London, order fulfilment can be a messy
business. Whenever timely delivery is vital, flexibility is the way
forward. A facility with flexibility can make adapt to emergencies and
changing circumstances without losing you those hard-won customers.

Familiarity With Your Needs

If your fulfilment provider understands your business deeply, they know
not to compromise on anything you’ve based your branding and reputation
on.

Location

Obviously, a London-based order fulfilment company is ideal to serve
the largest population centre in the UK, but where in London? A
well-located warehousing facility can receive shipments easily and get
them to your customers rapidly.

Ecommerce’s popularity and market share continues to grow, and consumers
all over the world have gained an unprecedented degree of comfort with
online and mobile shopping. As they become more willing to explore
alternative online retail options, consumers are turning to ecommerce subscription services (and related automatic renewing services) in greater numbers than ever before.

It is easy to see why – the convenience is huge. Every month, perhaps
every week your staples turn up at your door. For me it’s a bag of
Columbian coffee, a bottle of milk a loaf of bread and a half dozen
eggs. In an earlier generation the grocer’s boy would have delivered the
same riding a bicycle. Another service sends me a different bottle of
wine every month. Perhaps the grocer’s boy wouldn’t have been trusted
with that.

And of course, just about anything that is convenient for shoppers
translates into increased sales for the merchants (online or otherwise)
who support it. If properly managed, ecommerce subscriptions can be more
efficient and less costly from an order fulfilment perspective because
they are regular, repeating events. A good fulfilment partner should be
able to arrange discounted service for regular, reliable ecommerce
subscriptions in high enough volume. It costs them less, so you both
make more money.

The following are a few ways to make ecommerce subscriptions even more effective for you both.

Automated order management for ecommerce subscriptions

The way you handle your subscriptions can make a huge difference.
Quite a few online retailers still use manual order management for
ecommerce subscriptions, and that is a shame considering that they are
among the most efficient orders to automate, and the ones that will lose
you customers the fastest if they are forgotten or delayed.

Most ecommerce platforms and shopping carts already support automated
order management and ecommerce subscriptions. Recurring orders can be
generated and customers notified completely automatically, or pending
operator approval if you’re a bit of a technophobe. Most let you
configure the delivery interval pretty freely, have discounting options,
and support a degree of customer subscription and billing management,
taking even more of the administrative burden away.

Pre packing and labelling for ecommerce subscription orders

One of the ecommerce subscription model’s greatest strengths is its
predictability. In terms of fulfilment, predictable orders are more
efficient and less expensive.

If you (or your fulfilment house) knows that you’ll be shipping 1000
recurring orders of product A each month, and where they will need to be
shipped to, you have a lot of new options. You can use spare moments to
get ahead on your packing and labelling, or on a larger scale assign it
to an underutilised time or even schedule more people specifically to
get it all done ahead of time. No matter which option you choose, you’ll
likely be able to get the ecommerce subscription orders done with less
expense and faster than an equal volume of unscheduled, random orders.Of course, this will work better for some types of ecommerce
subscription than others. If the product mix varies unpredictably with
each order cycle pre-packaging would be quite a bad idea, but this is
rare amongst ecommerce subscription models. Even offering a different
assortment of goods every month can benefit from pre-packaging and
pre-labelling, so long as the decision of what products to send is made
some time in advance, and does not them vary.

Cost effective shipping options for ecommerce subscription orders

Beyond pick and pack, the ecommerce subscription model supports
several efficiencies in shipping, especially if your fulfilment partner
knows how to deal with them. Since these orders generally have at least a
week of lead time, fulfilment can start early to take advantage of any
slack periods the carrier may have, or be timed for maximum efficiency
in terms of other factors. It also gives you the option of using slower,
less expensive shipping options like consolidation.

On that note, if you do select a slow shipping method, consider the
impact of your cancellation policies. For example, it is possible an
order will already have been handed to the carrier when the customer
cancels.

Businesses all over the world are increasingly benefiting from the fantastic services that the courier logistics industry has to offer.

And it’s not just big companies benefiting from courier logistics either

Have you ever got home from a really tough day, only to find a card on
your doormat saying that an undelivered parcel has been returned to a
depot miles away?

Have you pulled your shoes back on and cursed to yourself, as you head
back out of the door, when all you want to do is put your feet up?

Or how about a birthday gift for a distant relative? At one time people
put money or a cheque in a card, but now that is considered far from
sensible!

With the worry of an important parcel going missing or a card turning up
minus the cash, what else is there? A bank transfer? Hardly the most
thoughtful, inspiring and heartfelt gift ever!

If you add this to Royal Mail’s price hikes of recent years, it’s no
wonder that, in our cash strapped and busy lives, huge numbers of
businesses and individuals are seeing the advantages of using courier
logistics.

So why are more businesses using courier logistics companies?

Some of those reasons are obvious – most decent logistics companies
will offer guaranteed reliability with a same day or next day service as
standard, for instance.

They may even come to collect your parcel for you at a time decided
by you – meaning no more post office queues or restrictions on your
time!

You can also guarantee that, no matter what shape or size your parcel
is, it will be taken and treated with the utmost care from front door
to front door.

In the past, using a courier service was considered a luxury.
Something to only be used on very special occasions, because it was such
a costly and bespoke service.

But now, at a time when cost is all important, the charges made by
most courier logistics companies more than rival those of their
competitors.

In many cases they beat them hands down. So why not make the most of this luxury at a price we can all afford?

All too many companies select a fulfilment partner without first
ascertaining their abilities with reverse logistics. Reverse logistics
is that part of shipping and logistics services dealing
with the movement of goods back from consumers, usually as a result of
product returns. Not every return is a complete write-off of course, and
a good shipping and logistics service provider should be able to
process returns in such a way as to recapture the maximum value from
them.

The goal of most reverse logistics procedures is to get the returned
goods back into the normal supply stream as quickly as possible, usually
by verifying their good condition and repackaging them at the
fulfilment house so they can be delivered again quickly and
inexpensively.

Returns, ecommerce, and shipping and logistics services

Ecommerce is growing rapidly, and online purchases are becoming the
norm for more and more consumers. Many kinds of online goods, especially
shoes and apparel, must expect very heavy rates of return because their
fit or suitability is difficult to determine online. The more that is
purchased online the more will be returned, and shipping and logistics
services must be prepared to do so efficiently.

A recent study indicates that 85% of consumers said they would stop
shopping with a company whose return policies were inconvenient. In the
same study, 95% of those who responded said they would continue to use a
company whose returns were easy. Clearly, encouraging returns provides a
vital competitive advantage, and the more your business model relies on
the ability for easy returns, the more vital it is that your shipping
and logistics service provider has efficient value recapture systems in
place.

How should a shipping and logistics services provider handle returns?

The returns process should be as streamlined as possible to keep your customers happy.

First, keep it easy for the customer. Once it was standard procedure
to force customers to jump through a few hoops before a return would be
accepted, and many were rejected outright. Those days are long gone.
Many ecommerce merchants now send return labels with every shipment,
just in case. After all, the cost if the sticker is unused is virtually
nil.

Next, settle on a formal returns policy. If your process is clear and
unambiguous, your customers will know what to expect from you, and most
will respect your process. Make sure your internal team, your shipping
and logistics services provider, and your customers all have access to
the written policy. Make it prominent on your website, and consider
printing it on the reverse of the shipping documents or invoice.

If your 3PL does offer enhanced reverse logistics procedures, find
out what they are, and ask how they can be adapted to your products and
procedures. Many can offer management of the returned products, and
inspect, repackage or even repair/replace parts to make the product
resalable. Many can also take charge of the recycling or disposal of
unsalable or destroyed merchandise or coordinate returns to your
vendors.
In any case, get to know what your shipping and logistics services
provider can offer in terms of reverse logistics.

In this economy, none
of us can afford to abandon the value of returned products.

Supply chain management
applications help you in creating plans and developing strategies for
your business in a more efficient manner. It enables you to assess your
manufacturing capabilities with well thought out logistics by planning
and carrying out the necessary tasks. Profit generation largely relies
on these two aspects because by managing these properly you will
dramatically increase the efficiency. There are a number of links in the
chain in business therefore by missing or not staying on top of one
part this may cause an unnecessary waste of resources.

Supply chain management is a tried and tested method but Enterprise Resource Planning (ERP) has
aided in reducing the inaccuracies and improved the performance of the
supply chain. ERP and Supply Chain Management is a way of planning all
the resources in the business enterprise effectively. The organisations
determine which operating systems and operating performance will assist
them in managing the business operations and meet the objectives of the
business. ERP and SCM also includes the trading partners of the
organisation which are the customers and the suppliers. It is for the
companies who are looking to generate rapid improvement in their
operations. The assessment of ERP and SCM depends a great deal on the
size of the operations and takes about three to four days. The
organisation’s intent, implementation and effectiveness of the existing
operations are assessed based on an ERP model.

ERP and Supply Chain Management for the Manufacturing Industry

ERP and supply chain management have greatly helped the manufacturing
sector. The shortcomings of this process in the manufacturing supply
chain however often need to be improved in order to make it more
effective.

Managing you supply chain effectively ensures you stay on top of your
competitors, lower your costs and improve your customer service by
getting your products to customers on time. The advance of technology
now enables you to electronically track your shipments and merge this
information into your management systems making the SCM process an area
providing advantageous opportunities.

Avoiding bottlenecks at various stages proves for an effective supply
chain management. There is simply no point in having a fantastic
component in the supply chain, when an awful part in the chain weakens
the complete structure elsewhere.

It’s also advisable to compare ones own supply chain management
system with the competitors to find out what can be done to help reduce
various wastage’s in the system.

Today a market is flooded with supply chain management and business
forecasting software as vendors are in constant pursuit to separate
their products from the rest. But not all of them deliver same amount of
efficiency. While selecting a business forecasting software solution,
as a user, you must ensure it is adaptive and appropriate for your
business size.

Risk management for your business

Risks must be minimized to avoid loss and costs. Supply chain
management deals with very complex process that a “broken link” stirs up
a chain of risks and problems. A lot of the risks can be minimized or
totally eliminated through inventory control, efficient and effective
monitoring and tracking, back up plans or alternative options, and
maintaining the quality of packaging and moving items handled.

Customer care is in the top list of priorities. When you deal with
providing service, your reputation will depend on how you deal with your
customers. Surely, customers prefer logistic companies who provide easy
and convenient access to their tracking system one that is updated in
real time. Customers require updates especially for delays and reason
for the delays must be communicated. Some delays are beyond the control
of supply chain management. One of the examples here is when a package
sits in the customs for few days for inspection.

The overall strategy that will be followed in the distribution
network, the supply chain management systems need to be very well
thought out so that they can be used as a source of competitive
advantage, this would also make them a profit center rather than a cost
center.

Many fulfilment houses now provide admail services, sometimes known as direct mail services or
advertising mail services. That is, essentially, arranging delivery of
adverts or marketing material to existing or potential customers,
usually through the post. All too often dismissed as ‘junk mail’, direct
mail services are one of the most effective and efficient ways to
communicate with your market. Direct mail services are the most common
form of direct marketing, used heavily by businesses small and large,
non-profit organisations and charities all over the world.

As email and electronic communications handle more and more of our
day to day interpersonal communications, the little mail we still get
grows in importance. While we once separated all mail into ‘bills’ ‘junk
mail’ and ‘real mail’, now we see incoming mail as consisting of simply
‘bills’ and ‘not bills’. In fact, the delivery of direct mail
advertising is becoming a large part of the postal service’s business in
many countries, especially the UK and US. As fewer private letters are
sent, post offices around the world are becoming much more welcoming to
direct mail services, and eager to do more business with them.

How direct mail services are targeted

Direct mail services can consist of catalogues, promotional CDs or
DVDs, coupons for local or online goods and services, advertising
circulars, or even fully produced guides to local services and
businesses supporting advertising and coupon content. The key to making
this all pay is making sure it gets to a high proportion of people who
are likely to use your goods or services. Many direct mail campaigns are
highly targeted, and should not really be thought of as a ‘mass
mailing’ at all.

The target group could consist of pre-selected known addresses
(current customers, sales leads, or other known potential customers).
Alternatively, certain geographical locations can be targeted rather
than individuals. Most post offices will contract to deliver advertising
content unaddressed, simply depositing one with each valid address on
one or more delivery routes or neighbourhoods, working hand in hand with
the direct mail services to do so.

When targeting individuals, a database of valid addresses and
associated personal information is analysed and a list of individuals
judged most likely to buy the goods or service, or respond positively in
some other way, is generated. Limiting the mail shot to known valid
addresses of potentially interested recipients cuts down on cost, bit
more importantly the bad feelings often associated with untargeted ‘junk
mail’. This is considered an example of database marketing.

When neighbourhoods are targeted, they can be selected for their
proximity to a particular brick and mortar store or distribution
network, or they may be chosen for a particular demographic profile
which corresponds well to that of known customers.

The content can vary between recipients as well, with for example
male targets receiving a different package of offers to females, or
those households with children receiving a different catalogue than
single households. Known customers can be sent different content than
potential customers. The details can vary widely at this point,
depending on your direct mail service provider.

The cost-effectiveness of direct mail services

The uninformed often assume that direct mail services are wasteful or
inefficient. The fact is, though, that admail can be extremely
efficient and highly effective, so long as it is professionally
targeted. Business intelligence assets such as the databases mentioned
above and effective strategy reduce both waste and the overall cost of
the campaign, and iteration based fine tuning such as split testing and
Nth name selects make the campaign performance improve over time, and
from campaign to campaign.

Of course, some campaigns are not sales oriented, so their cost
effectiveness cannot be analysed in the same way. Political campaigns
are big users of direct mail services, targeting whole electorates or
particular subgroups of voters depending on the particular campaign
goals. The same targeting techniques can be used though, and the same
gains in effectiveness can be expected.

Certain organizations and individuals have become known for their
prowess in direct mail, including in the US, the Free Congress
Foundation in the 1970s, Response Dynamics, Inc. in the 1980s, the
National Congressional Club, and Richard Viguerie.[16] With the advent
of the Internet in political campaigns, direct mail became just one of
many campaign management tools, but still played a significant role.

Business to business direct mail services

B2B direct mail services target other businesses rather than homes or
individual customers. B2B direct mail campaigns work in two general
ways. The first is a direct sales attempt, avoiding the use of an
in-person sales force or retail location. This is most popular for
products that are more or less fungible or require little in the way of
demonstration. The second strategy is to use the mailings to generate
leads for a traditional sales force, either face to face or telesales
oriented. It is best used for high price-point items that require
demonstration or that profit from generating a pre-qualified audience.

One method of direct mailing used in B2B is known as “bill-me”. In
this direct-mail marketing offer, the buyer is shipped the product prior
to payment and then is sent an invoice later

Environmental impact of direct mail services

One of the strongest objections against direct mail services is their perceived large carbon footprint. Here in the UK the Department for Environment, Food and Rural Affairs
estimated that in 2002 direct mail and similar promotions used
approximately 500,000 to 600,000 tonnes of paper, only 13% of which was
recycled. The Direct Marketing Association worked with the government to
set recycling targets for the industry, setting the recycling target at
55% by 2009. Though actual performance fell short, the carbon footprint
of modern, targeted direct mail services is in fact much smaller than
that of the mass mailing campaigns of twenty years ago.

The Contract Logistics sector
has seen a lot of merger and acquisition activity in the past few
quarters. What information we have from large 3PLs and contract
logistics players indicates that this is likely to continue for at least
the immediate future, and be a major factor in the profitability, or
lack thereof, in the sector as a whole.

Large scale mergers and acquisitions were common before the economic
recession that is just beginning to pass. This time last year, many
would have speculated that as investment money becomes more fluid again,
large scale takeover bids would once again be the norm. However, in the
aftermath of UPS’s failed takeover bid for TNT, consolidation is likely
to continue on a more selective, careful fashion. Smaller organisations
are more likely to be targeted for takeover or merger, especially those
operating in niche industries or peculiar geographic regions.

Takeover of a smaller contract logistics company may offer a beachhead in new markets

Rather than large companies merging (on polite, hostile, or somewhat
ambiguous terms) to combine their holdings and assets into an ever
larger empire, we can expect to see specific, relatively self-contained
operations which can add both territory and a great deal of synergy to
the larger operation to be the preferred targets.

FedEx’s acquisition of southern African contract logistics firm
Supaswift last year is a good example. At the time, it represented a
very large operation moving to incorporate a new geographic territory
along with a great deal of specialist knowledge and experiencing serving
that territory in one package. Another example is CH Robinson, a US
firm traditionally involved only in its own domestic market, who bought
out a Polish logistics operation called Apero in order to spread its own
influence to new markets. Last year CH Robinson opened an Istanbul
office, so it seems to be working.

Other analysts point out that this shift to smaller targets may not
be purely due to voluntary factors. It could be more important that
there are fewer large scale contract logistics companies in particularly
attractive markets, or at least few that are vulnerable to takeover on
terms ‘good’ for the acquiring company. The developing Asian, and
particularly Chinese market is one that seems like it would be ripe for
large scale takeover bids, but there are few if any large scale contract
logistics operations to be found, and none that offer multinational
concerns (or would-be multinationals) many of the things they want in a
contract logistics beachhead.

The Chinese contract logistics market is highly fragmented, with each
solid player limited to a particular geography or niche industry, and
often both. There aren’t really any national providers yet. On the other
hand, many of these smaller operations have begun to consolidate
amongst themselves, so that may soon change. Once a few national or
international consortiums form in and around the Chinese market, much
will depend on whether they make themselves vulnerable, or deliberately
attractive to, international contract logistics interests.

The contract logistics market in Europe and the UK

Closer to home, European and UK contract logistics operations are
beginning to attract interest from big players in the US, despite the
slow economic recovery in the region. This shouldn’t really be
surprising. Analysts are quick to point out that the European and UK
contract logistics market was listed as the largest single such market
in the world by the FTA’s Global Contract LogisticsReport
in 2013. This market accounted for more than 1/3 of the amount spent on
contract logistics worldwide, solidly ahead of Asia (with 31%) and
North America (at 27%).

This is expected to change only slightly in coming years. Experts
predict that Asia will be the largest contract logistics market by 2016
(with 36%) followed by a still significant Europe (31%) and North
America (with 28%). It is important to remember that a loss of 7% of a
rapidly growing global market is still a prediction of substantial
growth. This kind of stability is bound to be attractive to American
organisations who are having to look farther afield for promising
opportunities every year.

The contract logistics industry remains fairly fragmented on a global
scale. DHL Supply chain is still the largest operation by far. Its 2012
revenues were more than £10 billion, well in advance of the next
largest, CEVA, whose contract logistics takings were just over £3
billion, much closer to the third and fourth place holders Hitachi
Systems and Kuehne & Nagel (2.9 billion and 2.8 billion,
respectively). Nonetheless, DHL Supply Chain only accounted for 8% of
the global market last year, and only 12% of the European market. Even
combining the top ten contract logistics firms together would account
for only 22% of the 2013 global market.

The industry hasn’t been fantastically profitable lately, either. The
fact is that the contract logistics industry is still struggling to
shrug off the lingering effects of the last recession. Before the
downturn, average profit margins in the industry were around 4%. At the
deepest point of the recession they were barely 1%. Now they average
little more than 3%. Industry leader DHL’s profits were -1% at the worst
point, and are still less than the industry average. They may not be in
a position to expand at all.

Profits are so low that many investment professionals question the
long term sustainability of the industry. This is another factor arguing
against large scale consolidation, as expected profits don’t argue in
favour of large investment at this time.

The trend will most likely continue with larger forms snapping up
profitable, well-places smaller contract logistics companies, and
eschewing mergers with other larger companies.

If you’re a company who needs to reach clients through mailing
campaigns, or distributing products then the most feasible way of doing
this is by having a mailing house provider.
This saves your time, your money and other vital resources. The
question is though, what do you look for in a mailing house provider and
what are the benefits?

Choosing the most appropriate direct mailing service provider

The most appropriate mailing house provider will depend largely on
what it is that you want to mail. There are, however, a few general
guidelines which you should look for when selecting a mailing house: of
course you are seeking competitive pricing as well as flexibility, but
reliability and quality need to be paramount.

Initially, you need to ensure that the mailing house you check out
does have the correct capabilities to manage all of your mailing needs.
Has it worked with companies of your size previously? Has it experience
in your mailing products of your kind? If you are wanting to mail simple
letters and parcels then this should be a given, but what if you will
be mailing more unusual products which come in varying shapes and sizes,
can they accommodate this?

Where your mail needs to be distributed will be is another item that
requires huge consideration. An ideal mailing house will have offices
both in the UK as well as overseas, preferably with partnerships in
other countries. The UK one needs to be connected with Royal Mail, this
is imperative due to Royal Mail always being the final provider for
letter post in the UK. Your mailing house needs to have a vast network
of postal routes, with probable postage discounts during the fulfilment
stage. This brings benefits to both you and your profits, as well as the
customer who can be supplied a lower overall cost boosting your
company’s desirability and reputation.

Should you choose an end-to-end mailing house company?

A mailing house which will hold the most benefits is one which will
have a full end-to-end service, this could include digital or laser
printing, data printing, inkjet addressing, data management, envelope
printing and poly-wrapping. Finding a provider who can manage all of
your mailing needs therefore offering a complete service will save you
on vital resources such as time and money.

Looking for a mailing house which has been in the industry a long
time, not only hosts the benefits of them having adequate experience but
it also means that they will have a visible heritage. This will mean
that you can investigate their previous projects, customer testimonials
and accreditations – giving you an insight into how they operate and
what you can expect. Maybe you want to have a direct mail campaign, if
so the mailing house you choose should be DMA (Direct Marketing Association)
approved. You will be providing personal details of your business as
well as your targeted audience and customers and so confidentiality
needs to be secure, this means that the mailing house must also be
registered under the Data Protection Act.

So, in a nutshell you need to look for from a direct mailing service:

Competitive Pricing - never pay more than you need to

Capability - satisfaction that your requirements are manageable

Reliability - reassurance that your mailing will be delivered on time, and correctly

Conclusion
Finding a mailing house that performs a direct mailing service
covering all your needs, for a competitive price is gold. This is the
difference between making huge profits by utilising small resources,
making smooth transactions and retaining business – or simply not doing.
Building a good relationship with your provider is key, this means that
you will be provided with bigger and better discounts over time with
the more business you put there way. It’s a relationship, which when
works well, works for everyone involved.

Many mailing houses will include everything you need for marketing
campaigns such as a network of graphic designers for brochure and
catalogue needs as well as the functions to complete the task and then
mail it out. This cuts costs all the way down the line by having all of
the requirements in one place, as well as making the process much more
simple and saving on your valuable time resources.

It is estimated that nearly 80% of people will welcome mail if it

a) Looks good; has a clear design and is designed well and

b) Holds useful information.

This means that your direct mail house needs to know how to portray
your messages across efficiently in order for people to take note and
subsequently become a customer. This is another reason why you need a
mailing house which is experienced, which can provide a complete service
and which has stood the test of time with accreditation’s to show for
it.

You should be able to strike a balance between feeling confident
enough to leave your mailing house to it, as well as feeling comfortable
about making suggestions, ideas and alterations to their packages. This
is why flexibility is essential, you don’t want to be stuck with one
marketing campaign which consists of one design; your products may
change, you may develop promotions, new deals and a range of offers over
time which need to be easily including in your campaigns and the
mailing provider has to be able to adhere to this.

Another very important factor in determining the most appropriate
provider for your company is to decide on what contract length you
prefer; some people stick with the one mailing house forever whereas
others will want change – maybe they were originally UK based and now
want to branch out overseas or maybe their products have changed from
simple letters to more awkward mailing paraphernalia and this needs to
be considered before agreeing to lengthy contracts. Ensure that the
mailing house has the options to expand when your company does and can
accommodate any needs that may come up.

Many manufacturers have taken to outsourcing their packaging tasks these
days, as they find it more cost effective, and it takes away the
headache of dealing with all the issues associated with different
designs, packaging solutions and planning. So how do you know when to
start looking for a packaging solution outside of your own warehouse?

There are many “red flags” that should warn you that you really need to
start looking to outsource, and just a few of them are mentioned below.

Why you may need a contract packaging company

Your manufacturing lines are struggling to cope with your packaging
demands. This can happen often, intermittently, or gradually, and can
have a marked effect on your production so you should keep an eye on the
situation, and if you feel that your staff are not coping, you should
try to look for a solution outside of your building.

You have a new short term need for packaging that you would prefer
not to use your in-house staff for, as it would take people away from
your longstanding packaging needs.

You have a short packaging run for a new, test or seasonal product.
Utilising your current packaging equipment wouldn’t work, so you would
have to invest in new.

Environmental or regulatory requirements dictate that your company
complies with sometimes-expensive investments, which you are not
prepared to undertake in house.

Your in house staff cannot cope with a heavy workload, and you
require help to ensure that you get through this particularly busy
period.

Your product is sold overseas, so can be shipped to the destination
in bulk, and then each unit can be packed locally. This will save
transportation costs.

You have the need for a packaging form that your current staff or machines are not equipped to handle.

You have a chronic shortage of staff

Your machinery needs maintenance, and needs to be shut down for some time.

You want to downsize.

Of course when you are considering outsourcing your contract packing solutions,
you need to draw up a clear plan of action. Make sure to go through in
detail what you’ll want to achieve, and remember to ask everyone on your
current productions line (if you have one) for any opinions/issues they
might have so you have covered all basics. Once you’ve done this you
can then give a full brief to your prospective contract packaging
services supplier and they can tell you whether or not they’ll be able
to fulfill your needs.

How to choose a contract packaging service provider

It’s important to remember when looking to outsource your contract
packaging services, that you’ll need a contract packing company that
matches your ambition. You should certainly consider some or all of the
following criteria when choosing your packaging partner.

Where are they based?

If you’re nowhere near your contract packing company, then you’re
going to struggle in an emergency situation to get a result if such an
emergency should arise. Having a contract packaging company close by to
your manufacturing and distribution partners, or facilities can make a
real difference when it comes to saving time, and can also ensure your
freight costs are lowered. Of course, if your business is located in an
area with high overheads, such as property prices, this cost may be
offset. Take a careful look at prices vs. location and decide which is
more important to you.

How long have they been trading?

Whilst it wouldn’t be fair to say that a business in it’s first year
of trading cannot offer you something you need, many businesses prefer
to go with a contract packaging services company with a good
long-standing reputation in their field and if they offer a wider range
of products and services because of this, then you may end up getting
everything, and more covered. They may even be able to offer you advice
and products you have not yet considered which could be of further
benefit to your company.

How much will it cost?

Sift through the quotes you get and work out what’s included and
what’s not. Different companies offer different services so quotes will
vary greatly. Its important to remember that the cheapest quote will not
necessarily be the best, so work out what you’ll be receiving for your
money and weigh up the value of any extra’s you may have been offered.
It’s also important to read the fine print on any quotations. If you
don’t you could well be in for a nasty shock along the way.

How good is the communication

However good the solutions are, the thing that really matters is how
well you can communicate with your co-pack company, and how well they
communicate back. You should have contacts you can speak to on a regular
basis, regular reviews and the opportunity to ask questions at every
step. You’ll also need to ensure there is a hierarchy in place for any
complaints or issues as they arise, in order to make sure that you’re
able to make changes quickly if needed.

How big is the company?

Are they large enough to cope with the demands of any expansion?
Every business owner wants to think that their business will expand, and
if there are grand plans further down the line, you need to know that
the company you’re dealing with, will be able to cope with that growth
and even grow alongside you. On the other hand, you want to be important
to your contract packing company. As a small fish in a large pond, you
may not get the level of service you would with a larger company. This
is entirely up to you to get a feel by asking the right questions to
prospective contract packaging partners.

Do they have references?

A company you want to work with long term will have been trading some
time, so they should have a list of clients you can contact for
references. Be sure to double check their references by telephoning a
couple of those clients and asking some probing questions about how well
the company has handled their account. Whilst doing this, you may want
to check the list to see if there are any competing companies utilizing
your prospective contract packaging company. Could there be a conflict
of interests?

Once you’ve chosen your contract packing company

Make sure that you and your prospecting contract-packing partner are
on the same wavelength when it comes to the finer details of any
operation. Speak to your contract packaging supplier often during the
set up process to ensure they have all of the correct procedures in
place and ensure that you work to the same guidelines in order to make
communication, problem solving and analysis easier. This will ensure
that everyone knows what they should be doing and avoids any
miscommunication.

First impressions of your pick and pack services:

They say you never get a second chance to make a first impression,
and with business relationships this is extremely apparent. For online
retailers the first thing potential customers will see, in order to
gauge a feel for your company, is your website and so this must be
flawless. A good website will include an overview of your company, your
services and products, you must have easy flow content and the ability
for smooth transactions. The other side of the coin is how you work in
conjunction with your pick and pack provider
for your fulfilment. As flawless as your website appears for clients
and potential clients, the data behind the scenes needs to flow just as
well to produce straightforward transactions every time. If your website
doesn’t grab the attention of potential clients and produce sales, then
your relationship with your pick and pack provider will suffer as a
result.

Third Party Fulfilment Centres

Online consumers, on average, will place orders for one or two
products. Those purchasing for business purposes are likely to order
many products in high volumes. This difference, along with the fact that
there are more than 200 million Internet users around the world, means
that the frequency of orders in smaller volumes can be astronomical.
Warehouses, traditionally, are designed to handle medium to large order
volumes, they are to have the ability to process small and large orders
with the same efficiency and so your chosen warehouse needs to have the
required functionality to support all fulfilment operations. This could
mean things such as expanding existing facilities or modifying existing
operating procedures. There are many things involved in the structure of
an effective fulfilment operation, with the three main being picking,
packing and returns. On the whole, establishing operations that will be
the most effective for fulfilment operations will include:

Having a high-frequency picking area

The use of innovative and advanced picking technologies – i.e. voice recognition

Achieving orders through a one-day cycle

Providing special packing services – i.e. gift wrapping available

Operating an effective reverse logistics process – for returns

Overseeing an accurate inventory

If your fulfilment centre is not operating as it could be then your
business can suffer greatly. In today’s Internet world, consumers want
their products yesterday! They don’t want delays, they don’t want
damaged or faulty products and it will be your reputation that rests on
this – not your fulfilment centres. The chances are that whatever your
products are, there are hundreds more companies out there selling the
same thing and so for you to stay ahead – your fulfilment centre needs
to be doing all it can to be in front of the competition.

The Critical Ingredient – Order Picking

An order picking process needs to be efficient; this is a critical
ingredient in ensuring a quick turnaround and smooth process from order
to client. If this part of the fulfilment is not conducted accordingly,
then regardless of how productive all other areas are, your business
could be greatly affected. There are many issues requiring consideration
when looking into a picking process:

Storage Equipment: There are a variety of products that need
to be determined with the main being your storage solutions. Using the
incorrect materials for certain products could have a huge effect on the
productivity of sales, for example using wooden pallets for food
products could result in contamination with the worst case scenario
meaning a customer will become ill. You need to ensure that the storage
equipment used by your fulfilment company will be appropriate for the
products waiting to be picked.

Picking Technology: To increase the production of the picking
aspect of fulfilment, technology needs to be integrated with storage
and handling equipment perfectly. For the most effective picking
technologies you could look at radio-frequency terminals, pick-to-light
systems and wireless speech recognition. This is the innovative
technology, which saves on all resources such as time and finances as
computerized machinery takes over manpower, providing the best solution
with the lowest risk.

Slotting Strategy: The slotting strategy used by your
fulfilment company is a critical factor within an efficient picking
process. In layman terms, slotting strategy means assigning products to a
location. There are a catalogue of benefits to this being done
correctly, such as; reduced product damage, reduced injuries, improved
labour utilisation and better cube utilisation. The items which are to
be the most active i.e. the top 20% of products purchased, should be
placed in the middle of the picking levels to reduce the risks
associated with this task to employees and also to improve picker
productivity. The slotting strategy which is applied by your fulfilment
company to your picking operations can either make or break the success
of your ecommerce company.

Packing – Upgrades Are Essential

Traditional warehouse requirements have recently undergone many
upgrades; your fulfilment provider needs to be able to function with the
adaptations by upgrading from standard, non-adjustable packing stations
to more flexible workstations. There are now many various small
shipping cartons, bags and envelopes that are in use to cope with the
demand of sales in an efficient and cost effective manner. There are
many options for packing with the objective being that all products will
be thoroughly protected during transit – if products arrive at their
destination, damaged, not intact or faulty then it’s your company that
will be affected by this. You will be responsible for replacing the
product, apologising to the customer and facing the detrimental effect
it could have on the reputation of your business.

Returns – Handle Well For Repeat Custom

A significant factor, which determines whether or not a customer will
continue to use your company, will be how your returns are handled. On
average, over 30% of all Internet purchases are returned. This is put
into perspective when considering fewer than 10% of offline products are
returned. Your fulfilment company needs to be able to handle returns on
your behalf, effectively to prevent a detrimental affect on your own
business, in ways such as:

Customer Credit Process: A customer’s account needs to be
credited promptly after a return is made in order to preserve a strong
customer basis. This will require advanced systems to support a short
cycle of no longer than 72 hours to keep customer satisfaction.

Quality and Control: Is your fulfilment company able to deal
with the reasons for returns? For example, if the item is returned
because it was faulty, are they able to rectify this to resell? A good
fulfilment company will have a strong network of after-market dealers or
recycling providers in order to maximise the value of any returned
goods.

The Use of Technology: This could mean sorters, racks, conveyors
and modular workstations to support the anticipated volumes within the
returns area. If a returned order cannot be dealt with in quick
succession this could produce a detrimental affect to your business.

Having a fulfilment company who are able to deal with the entire
process of picking and packing is essential in today’s internet world
with the increasing demand for online products, with as much importance
on being able to establish a good final impression. It is important to
acknowledge that when making transactions online, the success of this
still boils down to physical movement of products to consumers.

Even top-quality cloud-based warehouse management systems have a
measurable lag time when transmitting instructions to your sortation
system. When a warehouse has to act on tens of thousands of tiny
decisions every day, and depend on split second timing for their
efficiency edge, even a small delay can make the whole system somewhat
ineffective.

Most experts agree that there is a definite need for warehouse control systems
(WCSs) and warehouse management systems (WMSs). The fulfillment
industry has experienced a great deal of change recently, and expects to
see as much or more in the years to come. The ecommerce and omni
channel distribution movements have made the supply chain substantially
more complicated, and the IT industry has responded by providing
solutions that can act on these new levels. Simple ‘pick pack post’ fulfilment would not be simple at all without these modern control and management systems.

Still, they are not without their problems. Many of these have more to
do with the way these systems are implemented than with the systems
themselves. Some experts feel that too many distribution centre or
warehouse managers have adopted cloud solutions too quickly, rather than
choosing a more traditional warehouse management system, installed on
their own, local servers.

At the moment, most users of cloud-bases WMSs are smaller warehouses
with basic equipment, often little more than lift trucks, handheld
barcode scanners or RFID devices.

Cloud-based solutions are appealing because of their lower up-front
costs. Upgrades and maintenance are also avoided, at least as separate
expenses, as that is all part of the SaaS package.

The downside of cloud delivery for a pick pack post facility

These cloud-based systems are hosted remotely, by the vendor or a
third party, and delivered exclusively by the internet. It is not
uncommon for the warehouse and server to be on different continents, and
for support staff to be operating in a vastly different time zone. This
leads to a lot more unavoidable down tome than can be expected from a
locally run system. Some workers will also have a certain amount of
mistrust of distant, essentially faceless support departments.

There is also the subscription fee, which may in the end be higher than
the licensing, upgrade and maintenance costs of an on-site system,
though this is certainly not always the case.

The real problem is the response time, though. A cloud-based WMS is a
transactional modality. It can be thought of as a slow freighter moving
across an ocean. In this analogy, a WCS is more of a speed boat. It only
has to cross form one side of your facility to the other, and does so
with a lot of agility. Both the freighter and the speed boat do
different jobs well, but they struggle in the wrong roles.

Higher volume distribution centres with a pick pack post, B2C focus
have had to deal with a nearly exponential growth in the number of SKUs
they handle lately. In this context, the WCS has a strong advantage
because of this agility, response time, and (if properly administered
and maintained) higher potential up-time.

The WCS and WMS both have their place in a modern pick pack post facility

To prevent delays and slowdowns, a very robust and reliable warehouse
control system is absolutely vital. A WCS, which again is usually
installed within the warehouse itself, can act as the local agent for
the more remote WMS. The slow part is the actual downloading of the
information on what items need to be picked from what location in
inventory and sending the information to the pickers. A WCS stores and
processes this data on-site, so there is essentially no delays or
communications disruptions.

A WCS will generally execute instructions which are provided by a host
system. This might be an ERP (Enterprise Resource Planning System) or it
could be a WMS. WCS software will often provide various advanced
management options such as order management, resource scheduling or
inventory control. The most popular WCSs are highly modular, so they can
easily be configured and are mostly platform independent. They feature a
very scalable architecture which satisfies the needs of warehouses of
nearly any size.

There is a great deal of confusion in the industry as to when one should
adopt a WMS solution, or if it is better to use a more traditional WCS
and its familiar interface and real-time data management capability.

Your WCS should be the focal point for managing your pick pack post
operations. The WCS is the link between your data host and your
real-time PLC (programmable logic controller). Your PLC coordinates your
real-time control devices and directs daily workload. At every decision
point the WCS selects the most efficient path (the routing of your
picker, for example) and transmits these directives to the proper
equipment. The whole process may be controlled by two different
utilities, a route director and a sort manager.

WCSs generally feature Wave Management, which times the release of work
to the warehouse floor. A WMS won’t be capable of this. Work flow can be
handled wavelessly – group picks are prioritised by order type,
shipping method, pick zone or delivery zone. A WCS allows you to better
balance picking activity by zone, though. If your pick pack post
operation deals with large numbers of SKUs and a high order volume, a
local WCS may be necessary.

Whilst warehouse control systems aren’t for everybody, as lean processes
and smaller margins mandate more and more efficient operations, many
companies are relying on WCS solutions aimed at streamlining their pick
pack post operations because of their speed and reliability, and lower
long term ownership costs.

Reports of a chronic lack of large warehousing and logistics
facilities in and around London could stall the South’s economic
recovery in several ways

Several heavy users of the fulfilment industry in and around London report that they are struggling to find larger (100,000 ft2
and up) facilities. If this shortage becomes chronic, it could slow the
rate at which foreign businesses become established in the UK
dramatically, with unpleasant results for the slowly recovering economy.
Many are already looking outside of London for their logistics needs,
and considering space all over the Midlands.

Of course, there are several ways to expand logistics in London.
New, bespoke space can be built, but the fact is that the design and
build option takes at least 18 months to go operational, and often more.
The current range of companies looking for logistics in London expect
to be fully operational within 6 months at the outside. They simply
cannot afford to wait a year and a half.
Real estate is not inexpensive here, either. Many developers claim to
be struggling to finance new warehousing and London logistics. Simply
put, so long as businesses hesitate to have new facilities built to
order, the finance sector will doubt the wisdom of lending to the
developers who would otherwise be willing to build speculatively. To
offset the perceived risk, the interest rates are too high for the
developers to accept.

So, logistic space effectively moves out of London. This will have a
cascade effect on other parts of the logistics sector, including carrier
prices.

Challenges to the carrier sector

Some would say the carrier sector is already struggling to meet
demand. Firstly, many carriers still report a crippling shortage of
skilled, experienced drivers. Many looked to increased immigration from
Europe to supply the needed drivers, but they are not coming fast enough
to allow carriers to expand to meet demand. Worse still, new people
have not been moving into trucking quickly, and high turn-over at low
levels means that the workforce is extremely top-heavy, with too many of
the best skilled drivers near retirement age, and too many of the
younger drivers essentially unskilled. The drivers of intermediate skill
and seniority just aren’t there, and in just a few years the carrier
industry will feel their lack.

Secondly, many of the larger operations in the carriage sector have
announced that they do not plan to increase the size of their fleets
substantially in the near future. The fact that the drivers needed to
get the lorries on the road just aren’t available doesn’t make expansion
sound profitable, regardless of demand. Just as with building new
warehousing and logistics facilities, the investors aren’t there. The
financial sector isn’t convinced that this demand will exist long term,
and aren’t willing to risk funding expansion cheaply.

Now, you see the real problem. If more logistics space is established
relatively far from major population centres in the South, demand on
existing carriage capacity will skyrocket. Most carriers are not
planning on expanding or adding substantial amounts of capacity. As
demand outstrips capacity, further expansion of logistics operations
outside of the Greater London Area becomes inefficient and ill-advised.
Perhaps the business doesn’t come to the UK at all.

One solution to this problem depends on squeezing extra capacity from
existing logistics in London. Many logistics organisations are looking
towards automation to fill this capacity gap. This trend has been going
on for some time, but the added pressure to make 50,000 square foot
facilities operate like 100,000 square foot facilities necessitates some
major changes in infrastructure. As the industry is forced to do more
with less, machines will replace people at an advanced rate.

Logistics in London increased automation as viable industry strategy

Logistics in London is at the forefront of using automation to
increase throughput without increasing overall footprint these days.
Especially in the UK, many facilities are still heavily human-centred,
and the opportunity exists to adapt proven technology from more
mechanised facilities in the United States and Europe.

Expanding automation rather than human workforce really does save
space, and makes facilities more efficient. Automation is moving into
new parts of inventory control, product handling and distribution every
day. A picker can do a lot more with a route-planner and a WMS
than they can without one. Modern inventory control would be impossible
for most facilities without scanning equipment even now. Even
management of a facility’s existing human workforce is becoming more
automated, as warehouse management systems handle more and more of the
everyday managerial function.

Experts are telling us to expect a lot more automation solutions on
the market in coming years, specifically for order fulfilment and
inventory tracking. The goal of these new systems is to allow smaller,
existing facilities to perform like larger ones, with increased
throughput and lower error rates, but without the real estate, carbon,
or energy cost footprints of traditional big warehouses.

It isn’t a movement towards blindly implementing new technology and
replacing workers willy-nilly. The movement, we should hope, will be
towards optimising the productivity of human workers, and allowing them
to do more with less strain, less hassle, and (if it is to be
sustainable) less stress and overstimulation. Logistics in London isn’t
really about space, it is about people. Any operation needs a minimum
number of skilled, competent people to make its processes operate.
Machinery, even the fanciest automation is part of that process. If a
logistics space is to operate at a higher capacity, the process,
including automation, must allow those people to do their job better,
more quickly, and with fewer errors.

London Logistics companies investment in automation expected

But now we come back to investment. Demand for improved IT and
automation means there is a real, enduring market for these products in
the UK, though, and this time investors can see it, and the money can be
expected to be there. The solution to the soaring demand for warehouse
space in and around London is in more efficient usage of existing space,
in renovating and redesigning smaller spaces with modern equipment, and
more importantly, modern processes and ideas.

One of the biggest expenditures for those who retail online is their
shipping and fulfilment. There are many costs involved before the
product reaches the customer and every part of the procedure needs to be
done well to ensure a successful transaction; crucial for success. Bad
fulfilment, poor order processing and delayed deliveries can make your
customers extremely unhappy and eliminate the chance of more business
and good word of mouth. So, ensuring that you get your items delivered
in a speedy fashion needs to be the top priority in a marketing
strategy. The major online retailers such as Amazon and eBay have their order processing and fulfilment needs down to a fine art and this greatly contributes to their huge popularity and massive success.

So why consider multiple delivery options for your order processing?

There are many more options for order processing, shipment and
delivery services than ever before and this is due, in part, to the
recent gyrations in fuel pricing which has put a real squeeze on
internet retailers of late – making comparing carriers and fulfilment
options more important than ever before. Many online retailers rely
extremely on parcel shipping, when prices go up such as fuel this means
that the shipping costs also go up to cover this and this is what can
greatly affect profits. Companies need to find the money for these
losses whilst still retaining customers and making sales, this can
produce many difficult decisions such as increasing product prices or
losing labour – it can, however, be aided by the correct logistics.

When you have many products needing to be distributed, it can be
extremely beneficial to look into multiple delivery options that can
help your business reach further – whilst keeping profits high. By
outsourcing through various different companies for your fulfilment
needs you can keep many costs down, there are companies who will charge
extra for rural deliveries, deliveries off standard routes and overseas
shipping – using different companies for each need means you won’t be
charged extra for varying deliveries.

You could even consider self-fulfilment, which does have many
advantages. It can be done by any company who simple has the room to
store products prior to order processing, have access to a printer for
address labels, able to order packaging and willing to stand in post
office queues or deliver products by hand, or through in-house staff.
This is extremely cost effective, as well as providing you with the
knowledge that items have been packed safely, securely and in tact.
Outsourced fulfilment is where you hand over control of order processing
and shipment to another company. They will be responsible for
everything from picking and packing to storing and distributing which
saves you a lot of time resources and why this is the most popular form
of fulfilment.

Drop shipping for your orders processed

Another option to consider is drop shipping, this is where products
are ordered through your website and you put the order through to the
wholesaler or manufacturer which supplies the products; acting as a kind
of middle man. With drop shipping there is no chance of you having
excess stock as you only purchase items when an order is placed. Drop
shipping is extremely low risk, you won’t do any of the hard work and
yet take a cut of the profits and you will only ever pay for what you
are guaranteed to sell.

Another way to go could be through mixed fulfilment. This involved
utilising a large range of fulfilment options to get items to customers.
You can use self-fulfilment for high volume, low-margin products, go
for drop shipping for the more high margin products and to fill out a
store with items you wouldn’t be able to personally stock.

Many companies will use more than one warehouse, branching out across
seas with the objective of lower labour costs as well as products being
able to be dispatched from more than just one warehouse in one country.
A highly popular country for order processing, product manufacturing
and shipping is India. This is due to the mass of cheap land and droves
of people seeking employment. India also is in the heart of Asia and
geographically closer to large purchasing countries such as the USA than
the UK is. Geographically, India is in a triangular shape to the south
of Asia, what this means is that there are many ports for shipping – a
huge advantage for fulfilment purposes. If you are a company who ships
internationally then it makes perfect sense to have distribution in
place from more than one country enabling your business to reach
further.

Finding a reputable company like Fairway Fulfilment & Logistics
to offer every service you could possibly need, saving time, money and
resources is a difficult task and one which is extremely exhausting but
it can be done. You need multiple delivery options for a fulfilment
provider to be the most cost effective and this means things like –
Economy Lightweight which will be a lower cost shipping service for
items under a certain weight. Economy Post, which is a cost effective
service for mid-weight items. Standard Ground, which is a delivery
service that is for all weights of products that are being shipped on
ground in one country i.e. not via sea or air. Expedited Service, which
is a standard delivery within 2-3 days of order processing for both
heavy and light products. Overnight delivery is something which can only
be done nationally – unless you do have other stocked warehouses
overseas if that is where the order was placed, this is usually the most
expensive form of shipping but in the current climate beating your
competitors means you have to have the edge – such as next day /
overnight deliveries available.

Something that is available to be in place is the many online
facilities, now considered essential for smoothly ran order processing
and fulfilment needs. Many outsourcing companies have the ability to
manage order processing online, update stock inventory, place orders and
track items during the transportation from shelf to customer. This is a
hands off way to keep an eye on the fulfilment side to your company,
meaning although you have handed over control you can still be fully
aware of what’s going on.

By streamlining your company’s operations through a pick and pack despatch partner,
this can greatly improve your fulfilment procedures as well as saving a
significant amount of money in import and export fees, and eliminate
security headaches. Order fulfilment can be a real headache, a drain on
time resources and a crucial thing to get absolutely right; by hiring
someone to do this for you this can lead to effective gains in consumer
satisfaction which, when it boils down to it, is how a company stays
afloat in the current climate.

Order fulfilment can be made easy with a pick pack despatch partner

Designing an order fulfilment system is extremely complex, it
requires much time on your resources and the practicalities of the space
to hold your stock; more staff to deal with the picking and packing,
hiring in couriers and distributors can all be very costly. You will
need to put the staff through training, provide equipment to conduct the
tasks, pay for the running costs of the vehicles (which could be
traveling world wide) and oversee that everything is done correctly – or
you could get a pick and pack despatch partner to cover the fulfilment
side of your business and prevent the many major business headaches.

A pick and pack despatch partner will have the manpower, space and
vehicles in place to provide a swift and smooth process for your
customers. All major online retailers hire fulfilment companies to deal
with their pick and packing, such as Littlewoods, EBay
and Argos – it is a tried, tested and proven method of effective
logistics, with all the main players in the industry providing products
this way. When you think of the staff, equipment, running costs and
training programmes that you would need to finance, hiring one pick and
pack despatch partner to do this for you is extremely cost effective.
Contracts can range from six months to two years and you can really
afford to be extremely selective with the company you go to, they need
you as much as you need them and so negotiations will likely be very
flexible.

The importance of security and accuracy of your pick and pack partner

It is imperative that you choose a good pick and pack despatch
partner, the person who will control this side of the logistics will be
the last person to see the product before the consumer. It is this
partner who will be checking for incomplete orders, product damage,
wrong sizes and colours and also they who will be responsible for the
product being packed safely and securely to eliminate damage during
transit. The bottom line is that if the shipment is not complete,
prompt, accurate and in perfect condition on arrival then the customer
will return it and this brings many problems. Your company can face
losing its great reputation, word of mouth recommendations as well as
the cost of rectifying this, which will greatly reduce the profit
margins on the order.

You need to investigate what security systems will be in place, to
safeguard your products through the entire inventory lifecycle. Many
pick and pack despatch partners are using state-of-the-art and very
hi-tech security systems; as much as you want to protect your company
name, they want to do the same. For the more advanced security systems
you will pay a higher price, with the average in the UK being around
£150 p.m. for storage (and protection) per 32 cubic feet, small – medium
items being packed and dispatched from £2 per item up to £10 and larger
items being around £15; weight dependant. For distribution and
transportation this is usually charged to you on an hourly rate with the
average being around £40 per hour – if you were not going through a
pick and pack despatch partner and paying for transportation yourself
the cost of this would be much higher, taking into account all the
running cost of the vehicles as well as drivers wages.

The benefits of outsourcing your Pick Pack Despatch work

Outsourcing your pick and packing services is, as well as more
convenient, a whole lot cheaper than running this yourself within the
company. The size of your company will dictate the amount of staff, room
needed, storage equipment, the number and regularity of of training
programmes and the machinery that you will need. For example, forklift
trucks will be needed to move many products of heavy weight as well as
conduct the loading and unloading of products; not just anybody can
drive these vehicles. A special license is needed which is obtained
through a training programme, That will be at your own cost – and can
cost in excess of £150 per person. You will need at least two people
trained in this to provide smooth logistics, which works out at a
minimum of £300,and then you will then need to purchase or hire the
trucks themselves, which cost at the very least £3,000 for a second hand
model. (Don’t forget you’re likely to need more than one forklift too!)
Not including the running costs of the vehicles or the wages for the
drivers, this alone is already costing you £6,600 at the absolute
minimum. The costs of running an in-company warehouse yourself also has
many small costs which may seem fairly insignificant but certainly add
up, such as; caretakers wages to clean the warehouses, cleaning
equipment, packaging supplies, lighting, heating and security systems.
All of these things will need to be to the highest standard for
effective logistics, with a price tag to match the quality. Security
systems, for example, need to be 24 hour and a simple alarm on the
outside of a building is not enough to safeguard your products.
High-tech and innovative systems are needed to guarantee safety, a
singular CCTV surveillance camera using state of the art technology is
in the excess of £400 – this is for one single camera. As well as
cameras, you will need alarm systems, security patrol staff and monitors
which all have running costs.

Choosing a pick and pack despatch partner who have security systems
in place already, a good security record and can evidence this well is a
partner that you can work closely with to ensure that your security
headaches are kept to a minimum, and can save you money in the long run.

‘Order processing’
is actually a very broad term, used to refer to all of the processes
followed to fulfil any order placed by a consumer for a good or service,
including picking, packing, and transporting the package to a shipper
for delivery. It is the heart of order fulfilment, and usually takes
place in a distribution centre.

Order
processing starts when an order is taken from a customer. More and
more, these orders are taken online, but telephone and written orders
are still a part of the process. Order processing ends when the customer
actually receives the products, and accepted that the delivery is
complete, accurate and satisfactory. As you might guess, the complicated
parts are between those points, and can vary dramatically between
different distribution centres and between different goods or services.

There are a few broad categories of order processing that we will examine

Some orders can be processed instantly – usually software, music or
ebook downloading. In this case, order fulfilment is little more than
processing the customer’s payment and initiating the upload to the
customer.

Orders of physical goods are quite common, and require a much more
complex process. The order is placed by the customer either in writing,
by telephone, or through an online storefront. Occasionally, orders are
made in person at a brick-and-mortar store, and sent to the distribution
centre electronically or by other means.

However they arrive, orders are routed to the distribution centre.
Some large companies maintain or contract several smaller, local
distribution centres located near large population centres or convenient
transport routes. Smaller companies rely on one or two distribution
centres. Next, a ‘pick and pack’ process sees the correct products
collected from the warehouse and assembled into a package for shipping.

Once the order is delivered to the customer, it is (eventually)
opened and inspected. Only after the customer verifies that the goods
they have ordered have been delivered correctly and in an undamaged
state is order processing really considered complete. If the package is
damaged, contains the wrong goods, or fails to live up to the agreement
with the customer in any way, they can be returned and order processing
continues until the issue has been resolved in some way, most often by
delivery of replacement products or issue of a refund.

How can you achieve an efficient order process?

An efficient order process is vital to a good business plan, and many
companies invest millions just in planning and creating a process. Four
things are key to an effective order processing solution: efficiency,
and the three factors of accuracy, speed, and customer satisfaction.

An order processing solution is efficient if it achieves its goals at
a low cost. Balancing performance and cost for an efficient process is
the job of the logistics manager. Accuracy is generally measured by the
process’s ability to get the right product to the right customer, often
within an agreed-upon time. This dovetails with speed. Many customers
demand very short turn-around time between placing an order and
receiving it. If you are selling same- or next-day delivery, your order
processing needs to be extremely responsive. Customer satisfaction may
be the most important of the four. Repeat business can make or break an
online retailer, and bad customer service has lost more customers than
poor quality or lack of advertising combined.

Many smaller businesses find that they cannot compete on all four
levels efficiently, and seek out third party logistics partners or
fulfilment houses to take over some or all of the order processing
function to remain competitive.

Efficiency is the most talked about aspect of order fulfilment, as it
defines whether or not the process is making or losing money. The
process is often controlled or directed by a software package called a
WMS, or warehouse management system. These are fairly expensive systems
to implement, but give a substantial boost to the efficiency of medium
to large operations, and more than pay for themselves. Because they are
expensive, many smaller operations choose to outsource their order
processing function to a fulfilment house who is likely to use a top of
the line WMS, and take advantage of other process efficiency measures.

A very efficient order processing system has a few key elements. It
should have a way to verify that incoming orders are passed on
accurately, and reasonably reflect customer expectations. After all,
doing exactly what you’ve been told doesn’t make money if it isn’t what
the customer actually wants.

A verified order should then be fulfilled accurately. The necessary
products need to be collected by the pickers quickly without error. At
the packing station, the collected order must be assembled into a safe
and secure package that minimises the risk of damage, is easy to ship,
and is itself inexpensive. Lastly, the package should be shipped out
quickly.

If any of these tasks are mishandled, the odds of making the customer
unhappy increase substantially. The order may be returned, adding
expense, and if not handles correctly the customer’s return business can
be lost forever.

Specifically, though, the process is different for each type of
product. Some of the factors that you will have to consider when
designing your order fulfilment process (or deciding who to contract it
out to) include:

The nature of your products – Fresh food requires a vastly different set up to CDs or DVDs, after all.

The way your customers order – do they order in bulk, or singly? Mixed lots or by type?

The way you package your orders – Jiffy bags? Standardised cartons and bubble wrap? They all require different procedures.

How much you will charge for shipping – if at all.

The nature and productivity of your workforce – will you use automated, manual or mixed processes?

It seems everyone has a smartphone or a tablet these days, and they
are being used for more and more of our daily computing tasks.
M-commerce sales have more or less doubled since this time last year,
and makes up a substantial portion of total online sales. The experts
all agree that e-commerce over mobile devices will continue to take up a
larger and larger share of the market, though there is spirited
disagreement about the predicted rates of growth.

This means that many of your website visitors are already viewing it
on a three to seven inch screen, whether your site can recognise and
adapt to this fact or not. If you aren’t providing a good user
experience for such a large segment of your visitors, is it surprising
that they are turning to competitors who are?

So, what can you do to improve mobile user experience for your e-commerce customers?

Compatibility

Having a responsive web design that can detect the device type and
operating system of your visitors is crucial. As an experiment, take out
your smartphone, and navigate to your website right now. What does it
look like? Can you see anything at all? The edge of your top banner? Or
everything, but too small to have any hope of reading? If you can see
it, how easy is it to use without a mouse? Without a keyboard?

Mobile customers should be automatically (and quickly) redirected to a
version of your site optimised for a very small screen, and limited
input options. This may require a major site redesign, but your web
designer or fulfilment partner
should be able to advise you. Alternatively, if you feel up to handling
your own site many major template-based CMSs have mobile friendly
templates and detection features.

Making sure your site can recognise and resize to fit your user’s
device is the first and most obvious step, but that is not enough.

Trust

More than 40% of m-commerce customers report that they worry about
order security. M-commerce is relatively new, and your customers have
the same trust issues that early e-commerce customers had, and they can
be dealt with in much the same way.

Assure your mobile customers that your order process is encrypted and
secure. More importantly, seek out, earn, and display any relevant
trustmarks prominently. Make sure they appear both on your home/landing
page, and throughout your entire checkout process.

M-commerce seems to be on its way from being a curiosity to becoming
the new norm. It certainly isn’t some fad. Make sure you adapt to it
early.

Any merchant, whether e-commerce, catalogue, or hybrid brink-and-mortar, will tell you that order fulfilment is vital to your customer experience,
and much more important to the all-important return business than front
end design, search engine optimisation or even advertising. The prompt
delivery of a customer’s order, as well as the accuracy, condition and
appearance of the order, is what customers will remember about an
internet purchase, long after they’ve forgotten everything else. The quality of order fulfilment is therefore more important to the development of your brand than almost anything else.

Pick and Pack area organisation: fast, efficient, and safe

The shelves of your warehouse space should be organised to promote efficiency and accuracy in your picking process.

If you use picking bins, make sure they are easy to access and move
about the warehouse. Much time and energy can be wasted just getting the
bin to the storage location of a needed SKU. Remember that anything
that looks difficult or awkward presents a risk of injury, and the cost
and loss of efficiency injury brings.

Make sure your pickers can see into the bins easily. Even if you have
an automated process and everything is scanned, a visual check can
catch a lot of potential errors.

Make sure your bins are sized in proportion to the orders they will
hold. This can be made part of a semi-automated process if you have the
size and weight of each SKU programmed onto your warehouse management
system.

Lastly, organise your product storage so that pickers don’t have to
sort through many similar products to find the desired SKU. This saves
time and reduces the error rate substantially.

Item location: Placement and layout is the cornerstone of warehouse management

The layout of your warehouse is critical to every one of its
functions, and can make or break your order fulfilment process. Divide
your floor into different picking areas, in terms of the distance
between item locations and the packing area.

Make sure that two classes of items are closest to the packing
stations: fast moving items and top sellers. You already know what a top
selling item or SKU is. It is important that the items you sell most
often are near to the packing station in order to cut down on
unnecessary movement through the warehouse. This reduces pick time, but
there is more to it than that. The less tome goods are in movement, the
less vulnerable your employees are to injury, the less the goods are
susceptible to accident, and the less your equipment is exposed to wear
and tear. Everything costs a little less when the warehouse is set up
efficiently.

Fast moving items are those products or SKUs that have the highest
turnover rate. They may be your top sellers, but they may not. If one
product is ordered in small quantities, perhaps due to bulk, limited
shelf-life, or high unit cost, it might be moved into and out of stock
more rapidly than higher-selling items. Especially of the issue is bulk
or unit cost, the accident protection savings of a short trip to the
packing area make treating it just like a high seller more efficient.

Use standardised packaging to keep everything moving quickly

Your packers should spend their time making sure everything is just
right for the customer, not deciding how best to wrap a product. If they
have to constantly make unguided decisions about what size of box to
use, whether item 123-456A needs bubble wrap, paper, or just a jiffy
bag, and then how much tape to use, you’re wasting time and money. You
are also risking unacceptable levels of damage in shipping.

Ideally, you should have a very few standard size packaging options
suited to your average order sizes and weights (or perhaps a bit above
on both counts), and a few other options for unusual or awkwardly sized
items. This will reduce decision making time and ensure more consistent
shipping.

A good WMS can group common SKUs by ideal box choice, making it even
faster. In addition, the use of standardised containers will often allow
discounted shipping rates.

Pre-assemble common orders to same time when it is at a premium

Kitting, or pre-assembling orders of either individual products or
specific groupings of SKUs, can make pick and pack operations much
easier for all involved. Many warehouse managers choose to kit orders
that are often made as a group (buy one get one free, included free
samples, computer and monitor combos, etc.) in order to save time. Kits
can be assembled at slow times or shifts, or by slower employees,
reducing the pressure on the packing area during peak times.

Alternatively, some SKUs are just harder to pack than others. Even if
they are not ordered very frequently, the presence of even one on the
pick and pack queue can slow all the orders behind it as the difficult
piece is dealt with. Kitting these items beforehand can save a lot of
time and effort, and ensure that these difficult items get the attention
they need. No matter what policy is, if the packers are in a hurry,
they won’t do the difficult SKUs justice. Make sure they don’t have to.

Kitting is particularly attractive to B2B sellers or anyone who
commonly sells in bulk. If an order is for 213 widgets, it is much
faster to pick two boxes of 100 each then pack the last thirteen than to
pack all of them, after all.

Not long ago, Branding Brand made its worldwide Mobile Commerce Index
report for April 2014 public, and the results were bullish on
m-commerce. The report consolidated global data on consumer activity
that came to ecommerce retailers through smartphones and similar small
mobile devices, and gave us some useful comparisons of the performance
of smartphone-optimised ecommerce sites between April 2013 and April
2014.

Just how are ecommerce sales and mobile devices changing the way consumers search for products?

They determined that smartphone visits to the 18 index-sites had
nearly doubled since last year’s sample, from just over 9 million in
April 2013 to 17.8 million in April 2014. Conversion rates remained
roughly steady, as the number of orders also fell just shy of doubling,
from just over 54,000 to just over 106,000. Importantly, global revenue
from tracked smartphone-optimised sites more than doubled from just over
£3.25 million to just over £7 million. Even accounting for inflation
(the study used USD) this represents nearly twice as many orders from
mobile devices, and an increase in average order value.

So, what about global market share? How do these figures compare to overall e-commerce?

April 2014 saw fully 29% of site visitors from mobile devices. Of
them, just under 2/3 were from iOS (Apple/iPhone) devices, and just over
1/3 were from Android devices. This more or less matches the market
share of the two platforms. I am a little surprised that there is
virtually no traffic from Windows phones, but not terribly. I mean, do
you know anyone who uses one?

The important thing is that these figures are up substantially from
April 2013, when mobile traffic was 45% lower and desktop/laptop traffic
was 22% higher (remember, it started out twice as high).

Triple digit gains cannot be ignored. They represent a basic shift in
the market, and ecommerce retailers had better pay attention.
Omni-channel commerce is no longer ‘on the horizon’. It is here, and if
your site is not responsive to the platform your visitors browse from,
you are leaving at least 1/3 of potential customers out in the cold.

Integrated Logistics Support (ILS)
is a technical process in which support and logistics considerations
are integrated within the design life cycle of a product or system. The
overall aim is a cost-effective and durable system that performs to its
maximum capabilities.

A lean, functional system that requires minimal support thereby
increasing one’s return on investment (ROI): functional, reliable and
usable whilst conforming to standards of best practice.

ILS is popular with product support, e.g. distribution and customer service systems.

Brief history of Integrated Logistics Support

Originally developed by the military, ILS has been adopted by the
commercial business world who apply it to many of their processes. It
consists of a series of support elements, integrated into the system
life cycle and measured at regular intervals.

The ILS whole is greater than the sum of its parts. In other words,
the combination of all the support elements results in a highly
effective process that boosts productivity of product support or
customer service systems.

ILS elements include:

Maintenance Planning

Logistics Support Analysis

Training

Human Resources/Human-Machine Interface

Support and Test Equipment

Computer Resources

Technical Data

Facilities

Packaging and Handling/Storage

Transportation/Delivery

This list is by no means exhaustive.

The result is a streamlined system that is easy to support and with a strong customer service ethos.

How do you determine the effectiveness of ILS?

The answer to that is a set of pre-defined metrics or ‘RAMT’ for
short (reliability, availability, maintainability and testability).
These metrics are used to measure the performance of each support
element throughout the lifespan of the system.

In some situations, ‘system safety’ metrics are used as part of a risk management strategy.

Design, test and refine

This is an iterative process whereby each support element is tested on
repeated occasions. Schedules are used which contain criteria specially
designed for this process to ensure product support or customer service
systems are in optimum condition.

An analysis is carried out to determine a set of tasks specific to an
individual element. This helps with testing and suggestions for
improvements.

One way to think of this is as a ‘continual improvement process’ in
which every aspect is tweaked to improve its functionality. Regular
maintenance, upgrades, repairs, training courses and tests are the tools
used to achieve this.

Testing is followed by the production of a report outlining
recommendations for change or improvement. It will highlight known
errors that are disrupting operational efficiency, slowing down
processes and leading to employee and management dissatisfaction.

You apply ILS as a means of refining your existing product support or
customer services system until it meets approved guidelines and
regulations.

The human element

People are an important part of any organisation. Their skills and
experience contribute to the performance and efficiency of the system.
Hence, why it is important that one nurture the capabilities of these
employees ensuring they are able to cope with the demands of their role,
often in pressurised conditions.

Human Resources are a vital part of the ILS process. The aim is to
match the right person with the right job and there are various ways of
doing this.

These include psychometric and/or proficiency tests that define an
individual employee’s personality, skills and aptitudes. Once these have
been analysed, management can allocate employees to roles in keeping
with the results of these tests. Finding a perfect fit between the two.

The ILS process can help HR and senior management to devise teams
consisting of a set number of employees, meeting Key Performance
Indicators (KPI’s) as part of an overall strategy. This may mean a
reduction in headcount but the trade-off is improved productivity and
lower costs.

Additional support provided in the form of specially designed
training courses, keeping employees up to date with the latest
technologies and processes.

Training the trainer

A word about training: this is another vital part of the ILS process
that is implemented throughout. It covers training materials, techniques
and equipment and applies to training officers/instructors and
trainees.

Training modules are devised for new employees, providing them with
the theory and practical skills necessary for their role. They are
regularly tested on their knowledge and ability to carry out their role
to meet the needs of the organisation.

Training officers are assessed on a regular basis to see if they are
familiar with their materials and the manner in which this is delivered
to the attendees. Training material is updated in accordance with
management requirements and business goals.

Form and functionality

Regular maintenance is crucial to the operational efficiency of
product support and customer services systems. ILS believes in optimal
functionality of a system, achieved by a schedule of regular upgrades,
maintenance and repairs. This pro-active rather than reactive approach
means that a system is always in tiptop shape and fully operational.

This reduces the risk of a drop in productivity caused by a system
failure, disruption or malfunction. If a piece of equipment breaks down
due to a lack of maintenance then the effects can be costly.

The conventional business model factors in the cost of repairs and
adopting a short-term approach, only undertakes this whenever there is a
problem.

ILS Summary

The ILS process is a long-term process that seeks to prevent any
problems before they arise. By implementing a series of support measures
within the design lifecycle of a product or customer services system,
they make use of existing resources for maximum productivity.

This technical process fits well within any organisation,
streamlining its processes and procedures to meet a set of goals whilst
saving time and money.

Many organisations operate in a short-term survival mode, which is
risky in an increasingly competitive environment. Implementing the
Integrated Logistics Support (ILS) process within your organisation
guarantees long-term survival and continuing success.

Reduce waste, rationalise processes and empower your employees. The
result is a lean and agile operational machine that performs to its
maximum capabilities on a continual basis. An excellent process that
delivers on all fronts, making it an essential strategy for business
improvement.

As we near the midpoint of the decade, the new consumer landscape of
the ‘teens’ is now well established. Two substantial changes from the
2000s have already become clear.

Let’s take a look at how much your packaging is costing your business

First, consumers think nothing of ordering nearly
any products via the internet for home delivery. Ten years ago, we would
have thought it impossible, not to mention impractical, to order a four
pack of toilet paper online. In 2014 we say ‘Is it any cheaper than
Tesco’s?’

Second, the huge variety of online merchants, large
and small, has produced a consumer that is more informed, opinionated,
and empowered than ever before. Those in the market for home delivered
toilet paper can think of four places they could order from without even
searching Google, and won’t hesitate to switch suppliers over a 2p
price difference, a single bad delivery, or an unconfirmed rumour of
unsafe working conditions at the factory that turn out this increasingly
apocryphal toilet paper.

So, how does this relate to packaging, and why do I keep bringing up bog roll?

It is actually related. I recently ordered four rolls of toilet paper
and a kitchen roll online, I won’t say from who. The way it was
delivered was rather surprising, and caused no small amount of actual
anger from my significant other.

Both products arrived at the same time, and in excellent condition.
The anger arose from the packaging, or rather the massive over-packaging
of what have to be the two least breakable products I’ve ever had sent
to me. The outer layer (yes, layers!) was a cardboard box approximately 2
feet square. From the weight, I did not immediately guess that it was
my paper rolls. Feeling a little bit of the excitement of opening an
unexpected package, I was further intrigued to find inside 2 smaller
boxes and a half dozen cellophane packets of air the size of Capri Sun
juice bags. I hadn’t ordered the pre-packaged air. I’ll buy bottled
water from time to time, but that’s about as posh as I get. I opened the
larger of the two boxes, and was rewarded with a large roll of paper
towels… wrapped in bubble wrap! The contents of the second box weren’t a
surprise, but at least there was no more unnecessary bubble wrap.

My better half is quite ecologically minded, and while I was most
bothered by the wasted expense of the overpackaging – a simple polythene
bag and a mailing label would have been plenty – he was actually angry
about the waste. The extra carbon footprint this overpackaging
represented was substantial. The final order was 2 or three times as
heavy as it had to be, so took more fuel to deliver. The boxes and wrap
and tape all had to be manufactured and delivered as well. He declared
that he would never use this retailer again, even after I explained that
they probably contracted out for order fulfilment. “It’s still their responsibility!”

So this retailer essentially paid more than they had to, and lost a
customer in the process. That is the real cost of overpackaging, and one
3PLs and e-retailers alike have to be sure to avoid.

Though many experts predicted that cloud computing would be the
development that brought modern supply chain execution software
solutions (SCEs) such as warehouse management systems (WMSs) within the
reach of the small or medium warehouses that could not afford the
initial adoption costs for these products, they have been very slow to
arrive, and even slower to be adopted. Cloud based WMS options have been
available for years, but have accounted for only a tiny fraction of the
UK WMS market in 2013. To put that in perspective, cloud based CRM
software accounts for nearly half of that market now, and the supply chain management sector looked at a s a whole is more than 20% cloud based.

Warehousing and cloud based warehouse management systems

The adoption demographics aren’t what we expected, either. The
warehouses and distribution centres that use cloud based warehouse
management systems seem to be the less sophisticated, or at least the
least heavily computerised ones.

One explanation why is that it isn’t the smaller facilities that
demand these services, but rather those that do not desire a great deal
form their WMS, and therefore do not wish to make a large initial
investment in it. Another theory is that warehouse management systems
are very transaction heavy and internally oriented, so few managers are
willing to trust cloud delivery. They don’t trust the reliability of
cloud delivery with such critical functions.

There is definitely the feeling among logistics managers that cloud
solutions are ill-suited to large facilities. The producers of these
cloud based WMSs struggle to reassure potential buyers that they have
overcome these shortcomings.

But how are cloud based SCE solutions really different?

From the end user’s point of view, a cloud or SAAS solution offers a
lower initial cost for several reasons. First and most obviously, they
aren’t buying the software upfront, just renting access to it. More
importantly, they are not installing the infrastructure that runs the
software themselves, all of that is operated centrally by the vendor.

While these systems are seen as less reliable (the internet still
goes down from time to time, even at the best facilities), they can
offer increased reliability because they are not generally truly bespoke
systems. Most suppliers provide access to a mature and well-understood
base code, and a separate layer of code to interface with the customer’s
systems that is highly personalised.

There are many benefits to outsourcing your pick and pack services,
but none greater than the savings on the resources of time and money.
You will save much time by no longer attempting to pack and fulfil all
orders alone, and you’ll save money by finding a provider who will over
special rates such as loyalty schemes or discounts. A more secondary
factor, although still important is the customer satisfaction you can
gain without doing any of the work to achieve this – by finding a
supplier with a reputable company and whose active years and client list
are extensive, you are guaranteed a speedy and successful service which
in turn means that your customer will receive their goods at a quick
pace, every time.

Things to consider when outsourcing your pick and pack services

Looking for a combination of a warehouse which is highly organised,
with a highly trained and large team will be the most advisable to
explore with there being a strong chance of continually fast rates of
picking and packing throughout the year. This is extremely beneficial
over the Christmas period, which is when many businesses will see a huge
rise in orders, which can result in backlogs, and they can be very
damaging for a business. Customer satisfaction is the end goal, and this
means your clients must be happy in all areas, such as experiencing no
delays in their products no matter what month of the year it is.

Benefits of using a fulfilment company for pick and pack outsourcing

By outsourcing your picking and packing this could also heighten
brand awareness, having satisfied customers who are then likely to
recommend your company and products to others creates this. Having an
order arrive on time and in a presentable way, is something that means a
lot and creates a pleasant experience for customers who are then more
likely to mention your products to their friends and family. This will
not be the case if they have had to wait in and had no order arrive,
experienced long delays or troubles with receiving their purchases –
things like this are eliminated when you channel your products through
the correct picking and packing service.

Also, by outsourcing this area of your business you are left with
more time to grow your company and spend time on new ventures. You can
outsource to many reputable providers who will offer short term
contracts such as pay as you go services, meaning you are not tied to
anything and can only outsource at busier times of year – or when you
need to.

Greener packaging methods for easier eco friendly fulfilment

Today’s customers are more interested in sourcing those items they
can from within their own country simply because of the knowledge of
their environment, the pressure to be eco-friendly, and to support their
own countries economy. Imports in the UK decreased to £42650 Million
in February this year from £43174 Million in January this year and this
is partly attributed to UK consumers choosing to “Buy British” Many
consumers these days are looking at ways to improve their carbon
footprint, and many are looking at everything from the food, clothing,
and decorative items they buy to the type of car they drive, and the
type of holiday they go on. The rise of the “staycation” is no longer
singularly attributed to budget restraints, but many people are choosing
to lower their carbon footprint by limiting international travel. 2/3
of UK families stayed in the UK for their holiday in 2013, and this
figure is likely to hold up for 2014 too. Protecting the future of the
environment has never been more important and consumers are growing more
and more eco-conscious.

As businesses seek to become more eco-friendly, importing from
overseas is often seen as a bad thing. Obviously, we are never going to
be able to produce all the goods we need in the UK, so it is imperative
that we find the most you can friendly way to move our goods
internationally. Therefore, packaging requirements for products need to
be carefully investigated, to provide the most cost-effective and
eco-friendly form of packaging for each item. From retailers, to logistics providers, the pressure is on to reduce emissions and package more effectively.

So, how can retailers and logistics providers reduce their carbon footprint by looking at packaging requirements?

Currently, retailers are using an excessive level of packaging to
ensure that their records are not damaged in transit. This bubble wrap,
tissue paper, protective packaging does not only have an effect on a
retailers bottom line, it also has an effect on their carbon footprint.
Knock-on effect is also taking place on the piece you missed side of
things. Always access packaging, if not recycled, you sent to landfill,
which is detrimental to the environment. Badly packaged items will also
take up far more room on a truck, ship, plane, or pallet than is
necessary. Looking at various different methods of packaging will enable
any retailer to cut costs on their packaging and also reduce their
carbon footprint.

There has to be a happy medium. Protecting goods in transit is a
significant worry for retailers, as they need to keep customers
satisfied whilst keeping costs low, and now with the added pressure on
their carbon footprint, they have a whole extra source of worry.

So what should retailers be doing about these issues?

Most importantly, there has to be an element of common sense.
Retailers do not have to apply the same principals when shipping pillows
as they do with glass picture frames. Those items that do not need to
be protected in transit to prevent breakage should be shipped with the
least amount of packaging possible, whilst ensuring that their items can
be shipped effectively.

For example, the pillows: In cellophane in a box is fine. There is no
need for bubble wrap, extra fillers or room between the pillow and the
box. Pillows have to be one of the least “shipping friendly” items
anyway, as their weight to volume ratio means that retailers pay through
the nose for space, so if possible, they should be packed tight with
very little extra stuffing. Surprisingly, some retailers do not take
heed of this advice. I myself recently ordered a set of pillows, which
came in a crush proof box, with cellophane and cardboard inserts.
Completely unnecessary. These items were not shipped overseas and this
is another thing retailers should be aware of. Shipping internationally
requires different packaging requirements than shipping inland. A large
mailbag should have protected those pillows effectively in transit, and
cost effectively too. Luckily, I recycle, so it’s slightly less of an
issue, but if I didn’t, and many people still don’t, then that packaging
would be going straight to landfill.

In a nutshell, there are a few pieces of advice to packaging successfully, cost effectively and in an eco friendlier way

Select the perfect size box or container

Sometimes, carriers find themselves restricted by the dimension of
boxes they have in stock that they can use to deliver their items. For
instance, they could have a product such as a small mechanical piece
that is 2 cubic inches, but their nearest sized box is one cubic foot.
This corresponds to 1,726 inches of cubic space squandered and extra
cardboard in addition to additional product packaging product to keep
whatever it is from moving about. The value of having perfectly sized
shipping containers in stock is vital for protecting resources and
conserving costs.

Pick sustainable packaging products

Recycled paper and card for shipping are offered at pretty much the
same cost as new products. There is a wealth of offerings, such as
cushioning, corrugated boxes, and padded mail bags.

The European Union created a measure in 1994 (the Directive on
Packaging and Packaging Waste (94/62/EC). This measure was issued to
balance various actions taken by many EU nations to effectively increase
the incidence of reuse and recycling of packaging. Packaging waste
equates to 17 % of Europe’s waste stream, however this number used to be
a lot higher.

Take advantage of more long lasting packaging materials

Just as vital as acquiring sustainable packaging materials, is
purchasing products that will stand up to wear and tear. From origin to
delivery, your standard parcel will get jostled about. If the packaging
is not sufficient enough to protect that item, that product will have to
be resent, therefore necessitating usage of even more packaging
material. For businesses to thrive, their items need to arrive intact at
their destination.

Another advantage of durable product packaging materials is their
capability to be used more than once. A great quality cardboard box can
possibly be shipped 5 or 6 times, at which point, duct tape could be
placed around the corners and seams to make it last even longer.
Therefore, those receiving packages should save the more resilient boxes
that come in for reuse by the shipping division.

Send out products in bulk

Another example for you: I ordered 8 products from an online retailer
recently, which then arrived in 8 separate packages. If the retailer
had the capability to bulk package their items, they would likely have
been able to save a fair amount of money in postage and packaging for
this and many other orders.

Choose an environmentally friendly provider

Another tip for more eco-friendly shipping might consist of making
use of a shipping or trucking service that has a good environmental
credibility. A fleet of hybrid distribution vehicles and continuously
developing more effective routes for their vehicle drivers is the mark
of a good eco friendly carrier.

Fairway has strengthened its Medical Fulfilment offering by extending
its existing MHRA Wholesale Dealer’s Licence to also include Veterinary
Products. This addition was to meet the needs of a specific customer and
involved a detailed external audit by the MHRA of Fairway’s security,
processes, cleanliness and staff training. This demonstrates the
company’s commitment to continue to expand its service offering to
customers.

Ecommerce retailers succeed or fail based on their web presence. Your
entire business rides on these bits of code, so shouldn’t you make sure
you’re using every trick in the book to its best potential? We’ve
included a few words of advice on some of the things even
well-established website can often improve on. After all, the more
sales you make, the more fulfilment business we do.

It is easy to fall into the mode of thinking that your core values
need to be quality and service, and that your website need only be
functional and efficient. This is only partially true, though. Letting
quality or service slide will end an ecommerce concern in a hurry, no
doubt about it, but a lacklustre or an unpleasant website can doom an
otherwise excellent business to obscurity and failure just as quickly.

Your online customers will probably never meet you or speak to you,
so you have to put your charisma and passion for your products into the
website itself.

Here are a few ways you can improve your ecommerce website for your online business

Spacing and Placement: Cluttered pages make people skip over
your carefully prepared information without seeing it. Too much blank
space looks unfinished and unprofessional. Make sure you have enough
content to hold the customer’s attention, and to keep them focused on
the features that will sell your goods or services.

Typeface or Font: In words you’ve probably already read online
“We are a Fortune 500 company, not a lemonade stand. We do not use
Comic Sans.” The font you use for your main content serves as your
facial expression online. Will your customers see it as serious? As
playful? As professional? As unreliable? Don’t get me wrong, Comic Sans
has its place, but make sure you think about what your font says about
your content.

Colour Scheme: Even if your web page is premade for you, you
will be able to change the colour scheme. There are hundreds of articles
available online about what colours make people feel, and which put
different customers in a buying mood. No matter what advice these
articles give, consider avoiding garish schemes. If you think it might
be hard to look at, assume it is. Understatement is always preferable to
garishness.

Criticism: Let me assure you, you are too close to your
website to judge it without outside advice. Ask the opinion of someone
who isn’t involved in the project for an opinion, then pay attention to
the advice, even if you don’t like it.

Supply chain management is complicated for a few different reasons,
but one of the most important is the relatively high rate of turnover
within it. The responsibility of managing a supply chain is more likely
to be passed between different individuals in the same organisation, or
increasingly made the responsibility of a 3PL, than many other business
functions. This can mean that a new manager is handed the reins with
little understanding of his or her predecessor’s strategy or aims.

In order to avoid disruptions and achieve gains in efficiency and
reliability quickly, we have identified three key areas that a supply
chain manager cannot afford to ignore.

1) Define the scope of your project

Unless you define the scope of your supply chain management project
early, and quite rigidly, it is prone to failure in several ways.
Changing deliverables, outputs and goals can cause mission creep, and
project failure as it becomes too large to manage and much more costly
than it was envisioned. Its goals can also be too vague to guide
meaningful action. Formal scoping meetings are highly advisable before
and during implementation.

2) Get buy-ins from the right people

Supply chain management projects can fail when the leaders who will
be relied upon to do the real heavy lifting of the project are not given
a significant voice in the formulation of the goals and overall
strategy of the project. Identify the stakeholders for the project
during the planning phase, make sure there is open communication between
all of them, and make sure they are all aware of potential roadblocks
you may face. Above all, make sure all of the stakeholders actually
believe the project can and will succeed. No matter how well-meaning, or
willing to follow orders someone is, they cannot give full effort to a
project they believe is irrelevant or doomed.

3) Establish and maintain the visibility of your project and its projected gains

Many projects are scrapped while they are still on track and viable
because the visibility of their effectiveness and expected returns are
lost. Like any business project, a supply chain management scheme must
be seen to be successful to remain successful. That is why it is
of critical importance to identify important milestones of your project,
and make sure the right people know when you hit them, as well as what
benefits they present for the company. Even if your project is perfectly
on track, a lack of visible progress can lose key stakeholders’
enthusiasm and backing, and doom the project.

Many ecommerce retailers understand the concept of inventory carrying cost (ICC) in the abstract,
but have trouble applying it operationally. Many e-tailers do not give
proper weight to the costs of carrying inventory, and therefore miss a
lot of essential inefficiencies in their operations. I want to highlight
a few points on how ICC affects inventory and how understanding your
real ICC is vital to reducing inventory while maintaining flow-through. Fairway Fulfilment & Logistics explain ICC in more detail below.

How do I calculate Inventory Carrying Cost?

Your ICC is really just the total cost of keeping and managing your
inventory, the lost opportunity costs of ‘tying up’ your capital in
stock, and the risk to the existing inventory. All too often, this is
not calculated, and capital costs alone are used in place of these
figures. For most operations, capital costs will be only 5-10%, while
the real ICC can be 20-25%. Think what these numbers could mean for your
organisation, and tell me if it is worth the time to understand ICC
properly.

So, how do I use ICC to optimise my inventory policies?

There has been a lot of ink spilled over inventory optimisation and
‘right-sizing’ over the years, and I don’t expect to add much to the
debate. I can, perhaps, summarise some of the simpler points. Your goal
is to adopt policies that set your inventory levels at the minimum
necessary to maintain operation without stoppages. Right sizing and
optimisation usually mean reducing these levels, but if the system needs
more inventory to work smoothly, right-sizing means up-sizing.

Optimisation should not focus purely on inventory numbers, but they
are often obsessed over because they are unambiguous and easy to
manipulate. A proper right-sizing operation looks to change the system
of policies affecting or affected by inventory to make the system run
smoothly with a lower ICC. Only then should inventory levels be reset.

System changes at this level will often require some degree of
capital investment. Using the correct ICC numbers (which are usually
higher than capital cost figures) will help a supply chain manager get
the buy-in that they need to get the job done correctly. A good supply
chain management 3PL can be of a great deal of help in setting inventory
levels and policy, so don’t be shy to ask for help.

Fulfilment is not just defined as the process of receiving an order for a product and making the
necessary preparations to get that order ready for delivery to the
customer. There is a great deal going on in the middle of that
statement: picking the product from the warehouse shelf; packing it into
a suitable box to ensure that it arrives intact and undamaged; printing
out a delivery label with name, full address and delivery instructions
and company sorting code. All of this goes on before the delivery
driver handles the package and ultimately hands it over to the customer.

How is the Kaizen approach being used by fulfilment companies?

So, from the point where someone chooses
an item that they want right through to the doorstep delivery a good
fulfilment company, such as Fairway,
should be able to help with every single process to streamline and
speed up the process. Some fulfilment companies are using the Japanese
principle of Kaizen, which literally translates as the practice of
continuous improvement. Although we all practice continuous
improvement, the Kaizen approach, which was introduced in Japan after
the Second World War is based on a number of factors that you can see in
evidence at fulfilment warehouses today. This pathway to total
fulfilment depends on good processes, initiative amongst the work force,
absolute teamwork and taking action to root out problems in the
workplace. The ultimate mantra is that Kaizen principles are EVERYONE’S
principles. Everyone from top-level management down to the part time
factory floor worker must work by these principles. It is clear that
such a working regime will inevitably bring success, provided that all
the staff, at every level, buy into the idea.

Within a fulfilment operation Kaizen
takes upon practices of Japanese businesses such as automation,
suggestion systems, quality circles and just-in-time delivery, to
deliver a streamlined process that continuously monitors and improves
standards. Some feel that this fits in perfectly with the fulfilment
model, as the goalposts are constantly changing and customers are
demanding more and more. Striving to offer more and more in terms of on
time delivery, streamlined pick and pack facilities and innovative
fulfilment software solutions, means that the industry must constantly
monitor and improve their offerings, or face falling to the wayside.

A recent piece in The Guardian discussed
the challenges retailers must look at with regards to fulfilment before
they consider taking their business overseas.It is the goal of
most companies to expand their sphere of operations and this can
sometimes involve tapping into overseas markets. The risks involved in
doing so should not be underestimated although these risks can be
reduced somewhat by choosing a strategic approach when it comes to
fulfilment.

Let’s take a look at what else has been happening around the fulfilment industry

The fifth UK Trade and Investment’s
Export Week was recently completed which gives retailers practical
advice on setting up overseas trade by means of a number of seminars,
workshops and overseas market briefings. The key message to take from
such events is that all fulfilment challenges need to be conquered if a
business is to succeed in any overseas expansion projects. Of these
challenges, arguably the most important one to consider is that of not
being over ambitious with your expansion plans. Some businesses fall
into the trap of assuming that what is good for one country will work in
the next one equally well. This is clearly not so and careful research
is essential into factors that make fulfilling orders difficult or more
costly than first thought.

It’s a great idea these days to share
resources especially if the business trying to break into overseas
markets is new to the game and does not have the right infrastructure in
place to be successful. Partnering up with other companies who are
experienced in those countries can ensure exceptionally good results.
For instance a small retail outfit can use overseas warehousing and
logistical expertise to get their products from a UK manufacturing base
directly to overseas customers. In time they can do it all themselves
but, in the early days, what better way to achieve fulfilment than to
use a partner company that is already well established.

Ultimately retailers have to ensure that
fulfilment is a major part of the WHOLE ordering and delivery process
and not just something to be bolted on as an optional accessory. New
Internet technology makes the world smaller every day and a customer
sitting in front of their screen in a rural part of the USA can suddenly
become the next customer of an online retailer in the West Midlands of
the UK. For this customer to have a wholly satisfactory retail
experience though everything in the chain has to be right. The
description and images of the product; the pricing of the goods; the
guarantees offered; the returns procedure should the product not be
satisfactory. All of this is part of the fulfilment process and if all
is correctly set up then the system works. If a part of it is
sub-standard the fulfilment experience fails.

Health and Safety in the Warehouse

A well known logistics provider has been issued a £250,000 fine
following the fatal fall of a worker through a stockroom roof just a
short time after the Court of Appeal verified that fines would be based
upon the severity of the breach of Health and Safety and the financial
scenarios of each offender.

HSE regulations and January update

The HSE upgraded its guidance on working at height in January and
this was done to supply targeted and clear guidance to particular
sectors on individual or business level obligations as well as aiming to
combat misconceptions of the guidance. Given the story below, it is
worth making the effort to see to it that your company doesn’t get
caught out.

Aramex (UK) Ltd employed Gary Edwards, who works as roofing
professional, and Michael Sweet, in order to deal with a leak and to
ensure the guttering of one of their properties was cleaned in December
2011. Whilst cleaning the guttering, Mr. Sweet stood on a fragile panel
in the roof, which gave way and he tragically fell to the concrete floor
below. The Health and Safety Executive (HSE) discovered after an
investigation that no precaution had been put in place in the area and
prosecuted Mr. Edwards as well as Aramex. The HSE ruled that Aramex had
ignored their own H&S guidelines to monitor the work or examine
exactly how it would be completed, despite understanding of the
fragility of the roof. Mr. Edwards also admitted that the only safety
equipment provided to his worker was a pair of safety gloves. There
were many missed opportunities to provide a safer working environment,
which may have reduced the risk lower, such as providing harnesses,
scaffolding or placing boards over the vulnerable area.

Both Mr. Edwards and Aramex pleaded guilty to breaches of the Health
and Safety at Work Act 1974. Aramex received a fine of a quarter of a
million pounds, whilst Mr. Edwards was issued with a 4 month prison
sentence, which was suspended for a 12 months.

Going forward, it appears that big companies (initially defined as
those with a turnover in excess or £ 1 billion) can expect far higher
levels of financial punishment if convicted of these sorts of offences.
There will now be much more stringent examination of accounts prior to
and at any sentencing hearing. Smaller sized companies, although not
particularly scrutinized in detail by the Court of Appeal, are likewise
most likely to see fines enhanced in the future.

Machine to machine data flow (M2M), once called embedded computing
and now ‘the internet of things’ (IoT) is gaining ever larger shares of
the market.

Does your supply chain strategy take the possibility of the
disruptive market shifts this could bring in the near future into
account?

I’m an old fuddy-duddy, and I admit it. The idea of a toothbrush that
connects to a smart phone app seems downright silly to me. The idea of
fishing out my phone or a tablet to dim the lights in my home seems like
a lot more trouble that walking over and fiddling with the dimmer
switch. But regardless of how I reject the consumer end of this
revolution, I would be a fool to ignore how it is set to change the transport and logistics sector.

As the IoT idea draws more investment and big name support,
practical, useful examples of the technology are already on the market
and will soon become almost ubiquitous. Global M”M connections are
supposed to pass the quarter-billion mark this year, up from 195 million
last year. Estimates for 2020 are between 20 and 50 billion M2m
connections, but they are mostly guesswork. (Remember when dates like
2020 were by-words for ‘the far future? Now it’s just 6 years.)

As the floodgates of investment money open, new manufacturers will
enter the IoT market, and each will need to shoulder their way into an
already highly subscribed component and materials market. Securing a
supply chain will be vital to every one of them, and may make or break
most of these start-ups before they even consider turning a profit.

How do you make a purchasing forecast when demand is nearly impossible to calculate?

All many start-ups know is that the demand will be there, and if they don’t serve it, someone else surely will.

Many of these tech firms will beturning to dedicated third party
logistics partners to handle these supply chain worries. An established
logistics partner can offer the experience and reliability that a
fledgling company needs in order to focus on actually making their
innovative devices and bringing them to market. They can also provide
these services at a substantially better price than can be achieved
in-house on a small scale, so could be the factor that makes one company
go on to greatness while another on (or ten) fail to thrive.

The order fulfilment and e-commerce sector caters to new market
participants more than almost any other, so we get a lot of questions
about how fulfilment and e-fulfilment actually works. We have gotten a
lot of questions lately about minimum order volumes, fees, and storage
levels and how they work in the third party fulfilment market, and I
will try to answer some of those today.

What is ‘minimum order volume’ in third party fulfilment?

Online retailers who are looking into potential third party
fulfilment partners will have to understand how minimum order volume can
affect them. Not all fulfilment houses have a minimum order volume, of
course, but you’ll need to understand what it is before you can really
compare the prices and services offered by different 3PLs.

If you contract with a 3PL for a minimum of 500 orders per month,
there will be consequences if they process fewer than 500 orders from
you in a month. Many will charge a default fee for not meeting that
minimum. Others will charge you as if you had used the minimum number of
orders regardless of actual use. Read the minimum order requirements
carefully when comparing pricing schemes.

What about ‘minimum monthly fees’?

This is a very similar concept. Some fulfilment or logistics
providers have an absolute minimum amount you will pay every month,
regardless of actual activity, usage or order volume. If you have a
monthly minimum fee of £500, and your usage would only result in a £300
bill, you’ll be charged £500 anyway. On the other hand, if sales meet
your expectations, you may never run into a minimum. Just be aware of
what it means, and consider it when choosing a provider.

And minimum storage levels?

Again, the same concept but a different application. Some fulfilment
partners charge for a minimum amount of storage space used, even if you
don’t use quite that much. It may be calculated by square foot, by
pallet, or even by SKU, but if your contract calls for a minimum storage
level of 5 pallets and you pay £20 per pallet used, you’ll never pay
less than £100 no matter how few pallets you actually use. Of course, it
can (and really should, unless something is wrong) rise above the
minimum amount.

Ecommerce is changing what shopping means to people all around the
world, but unfortunately it is also changing the way a small but growing
minority of customers try to steal merchandise. Smaller e-commerce
sellers in particular may be vulnerable to this, and should work closely
with their logistics partners to prevent it.

So how is digital shoplifting affecting online businesses?

Digital shoplifting is mostly consumers making false claims that
their orders have been ‘lost in transit’ or destroyed (GLIT or Goods
Lost in Transit claims). This is technically fraud, not theft, but the
effect on the merchant is the same. These false claims are made in the
hopes of getting free replacement merchandise, or a refund to which they
are not entitled. False claims of these kinds are becoming more and
more common, both in the UK and around the world. Anyone who sells goods
online should be wary of, but not hostile to, claims of undelivered or
damaged goods. Most such claims are legitimate, even now.

In a recent survey, more than 90% of the loss prevention specialists
polled agreed that false lost order claims now pose a serious threat to
the ecommerce sector. Nonetheless, the majority of online retailers have
no specific policies in place to verify these claims, nor to deal with
them once they are uncovered.

False GLIT claims cost UK online and mail-order retailers a
staggering £405 million every year. As experts estimate that the average
false GLIT claim costs the seller around £40, it doesn’t take many to
turn a good month into a bad month for most online sellers.

How can you prevent false GLIT claims against your ecommerce business?

Retailers or 3PLs with the necessary software and management systems
in place can assess claims for fraud risk at the first point of contact,
when the least amount of time and effort have been spent on the case,
and detection will save the most money. If both the 3pL and the carrier
work closely together and keep good records, fraudulent GLIT claims can
be challenged quickly and easily.

Omni-channel or multi-channel fulfilment has significantly become the
standard for retail providers, manufacturers and merchants to fulfill a
broad wealth of different shipments. For that reason, operations now
have to be more versatile and efficient to ensure the increasing range
of order types and sizes are fulfilled, by showcasing order fulfilment
processes with highly intelligent automation of the process.

So what is omni-channel fulfilment and how can it help your business?

Omni-channel fulfilment is known as the capability to process orders
within the same fulfilment operation from multiple different sales
channels. Fairway Fulfilment & Logistics have a vast amount of experience in omni-channel fulfilment.

Some of these can include:

Internet/direct to consumer

Speciality shops

Direct to big box merchants

To other distributors

To reach this level of flexibility, an operation needs the right
innovations, design and processes to deliver this requirement.
Consistent growth of internet fulfilment with instant mobile orders, and
same day client shipment expectations, can lead to distribution
operations having to pick,pack and ship in two to four hours, or even
less, which is far less time than that given with existing 8-hour
shipment windows.

Many fulfilment operations struggle to find the correct balance
between picking, packing and delivering innovations with best practice
when executing lean Omni-channel fulfilment operations. The most
successful operations process a mix of Less than Truckload (LTL)
shipments with full-pallet and/or mixed-case-pallet orders, are able to
create a system of fluid-loading directly to the trailer, and can
balance the complexities compounded by the growing need for incorporated
split and mixed-case orders. Shipment labeling requirements and order
and dispatch paperwork requirements can further complicate the
situation.

Internet fulfilment sees the usual spikes throughout the year, and
nonstop order volume driven by product releases, produces more
challenges for specifying and developing procedures and software needs
of a successful operation. Countless orders per hour of both multi SKU
and single item orders and the consumer demand for the most affordable
shipping techniques needed to deliver orders direct to consumers often
result in problems for standard distribution operations.

Omni-channel order fulfilment necessitatess a comprehensive plan that
thinks about all the dynamics needed to stabilize workloads and
effectively process customers orders in a simultaneous parallel running
pick and pack process for each unique fulfilment channel.

The release of orders is the driving force of the operation and needs
the right algorithms to adeptly and intelligently handle the mix of
orders to satisfy consumer requirements.

Other omni-channel requirements include:

A proper order fulfilment design which must include SKU slotting
based upon the order mix and the material storage equipment/storage
area;

Speed, effectiveness and precision in choosing to fill orders and
move and coordinate labor to the work zones based upon the present order
wave volume;

Scalable design to fulfill the company’s five-year development projections and business approaches;

Design based on lean low-touch procedures to decrease future and present labor requirements;

Tested processes improved by the most current automation innovations to decrease execution risk,

Improvement of accuracy and consumer contentment,

Higher operational earnings

Once the design is solidified, it should be simulated and monitored
to ensure the new design is fully workable prior to implementation. Then
it may be time to transfer to the right mix of automation technologies
to improve processes and execute a lean, automated pick, pack and ship
order fulfilment operation.

Every business, or professional seller, will scrutinize their
incomings and outgoings to create a greater profit margin. High profits
with low expenditures are what keep a business productive and running
well, so business owners explore every avenue where they could cut
costs. This is apparent with packaging for items which are to be shipped;
by saving on packaging there will be a smaller outlay with the same
return on product price. You can do this by choosing your packaging
wisely, with much research and thought and looking into things such as:

Researching and Assessing Product Requirements

Eliminating Excess Layers & Labels

Buying in Bulk

Reducing Labour Costs

Looking into Price Changes

What should be your main concern when choosing packaging for your goods?

Your main purpose is always to keep your products safe in transit,
and so quality should never be jeopardised. Your packaging needs to be
able to keep your product protected whilst in storage, transit and
during distribution meaning that it must be tamper proof, it must be
resistant to the elements such as moisture, heat and rain and your items
need to be sufficiently protected so that if they are mishandled during
their journey they will not sustain any breakages. You can adhere to
all of this, and still keep costs low which in turn will have great
returns such as a higher profit for you.

For the internal protection of your product during shipment,
acknowledge that every layer of cardboard, bubble wrap, foam and amount
of packing peanuts will add to the overall costs, not just on the
packaging itself but on weight . Protection is fully needed but maybe
you could explore substitutions – such as opting for one layer of
protection as opposed to multiple ones. According to experts you rarely
need more than 2 inches of empty space in between the outer box and the
product so look into ensuring that your boxes are the right size – this
will likely save a significant amount of money on both packaging
materials and also shipping costs. Assess your products requirements
thoroughly and compare the requirements to current practices, you could
discover that you are able to switch to using more lightweight carriers
or substituting card for film/wrapping.

A purchase option is to buy your packaging materials in bulk, this
may mean that you will receive many discounts and this can apply to
smaller suppliers who are more likely to appreciate the custom and show
their gratitude with reduced costs. Never become complacent with your
expenditures, items such as steel banding and stretch film can change by
over 30% on a monthly basis! If you are not aware of price changes you
could be stocking up on supplies at the wrong time, by working with a
diligent supplier whom you trust you can reduce this risk.

The e-commerce market is expanding rapidly in the UK (as in the rest of the world), and online customers are demanding express delivery much more often that has previously been the case.

So how can 3PLs help businesses with their order fulfilment ?

It seems that what online shoppers want most is speed and
convenience. That’s why they use the internet in the first place. In
fact, next day delivery is the fastest growing delivery option by far,
and the segment of the delivery sector that offers it grew nearly 30% in
the last four years. As it stands, next day delivery accounts for more
than 2/3 of the consumer delivery market.

Because consumers are much more picky about delivery performance than
businesses, the delivery market is shifting to specific time windows,
rather than the traditional 24 or 48 hour windows. This is much more
convenient for the consumer, but it is also more expensive. Not only
does the courier service cost more, but the individual e-tailer has to
respond to orders almost instantly to get the product on its way in
time. This precludes just batching all of the orders at the end of the
day, and disrupts the rest of the workday. I don’t need to tell you how
your customers feel about paying one penny more for delivery that your
cheapest competitor though, do I?

Where does that leave E-commerce businesses?

So that leaves the e-commerce seller in a tight spot. Their market
demands more expensive service without a price increase. More and more,
small e-commerce businesses are turning to 3PLs to handle their order fulfilment,
or even their entire logistics process, including supply chain
management, pick and pack, order fulfilment, response handling, rework
of products or hand finishing and enclosing. It seems that 3PLs can
offer these services at a lower cost that most businesses can manage
in-house, and are better able to meet the kind of rapid turn-around
times that same- and next-day delivery requires.

Order integration and warehouse management

The real strengths of a good fulfilment 3PL are omni-channel order
integration, high-volume discounts, and the ability to dedicate a
flexible amount of warehousing space to each of their ecommerce clients.
It is a success as a business model because they can literally offer a
better level of performance at a lower actual cost than most small or
medium sized e-commerce operations could manage in-house.

Private courier companies have grown almost exponentially recently, and the parcel boom is directly tied to the number of e-tail and e-commerce businesses now operating in the UK.

In fact, 2013 saw 1.83 billion packages sent via courier from the UK
(and most delivered within the UK). There are just under 64,000,000
people in the UK, and that means that every man, woman and child in the
UK got 29 packages last year on average. 2014 is set to be an even
bigger year for ecommerce, seeing more than 2 billion packages, and more
than £7 billion worth of business to the courier industry.

E-commerce is the driving force here, as UK demand for consumer goods continues to expand

In 2009, for example, only 23% of the total goods delivered were of a
retail, consumer nature. By last year that has all but doubled to 39%.
The UK’s online retail market has nearly doubled as well, growing 86%
between 2009 and 2013.

One incongruity, though, is that business volume has risen much
faster than total revenues, especially in ecommerce. That means that
while business is growing, profit margins are shrinking. The increased
levels of competition are making this the classic ‘buyer’s market’, and
more sellers enter the online market every day.

So what does this mean for the e-tailer?

How can they compete with every new stall at the internet’s global bazaar? The answer is the third party logistics industry. Many of the most successful of these new SMEs use fulfilment houses, such as Fairway Fulfilment & Logistics,
to handle almost all of their logistics and order fulfilment functions,
and those fulfilment houses use the resulting economies of scale to
make order fulfilment and delivery as inexpensive as possible. The
improved performance these 3PLs offer, in terms of speed, order
accuracy, and customer responsiveness make their ecommerce partners more
profitable, and more popular with customers.

As a result, smaller and smaller businesses are seeking logistics
partners to ensure their profitability in years to come. The best 3PLs
for small and sole trader ecommerce concerns offer full, multi-channel
software integration with the seller’s online stores, reducing the
manpower and time that must be dedicated to order processing, and
allowing very small operations to take advantage of their services
efficiently.

Experts predict ecommerce deliveries to drive parcel volume another
38% higher by 2018, so expect competition to get even tighter, and for
successful ecommerce sellers to become even more reliant on 3PLs for
their order fulfilment function.

Not Everything Has To Be Shipped Internationally

For many world wide businesses and international sellers there’s a
lot to be decided on the shipping side of your sales. You need to choose
where to ship, and remember that not everything has to be
international. Sometimes, shipping an item to the other side of the
world, or many miles away, may cost you more as the shipper than the
actual item is worth or the payment you are receiving – in cases like
this, it is just not feasible to offer international shipping, it’s a
drain on your profits and is also not beneficial to the consumer who
will likely face a long delay and higher shipping cost, than they would
have with a seller closer to home. It could be damaging for your
businesses reputation to even attempt international shipping in many
cases.

So what should you consider if you are thinking of shipping internationally?

If you use international selling sites, you can receive considerable
discounts for your shipping options and continual good feedback on top
of this can mean that international shipping can be productive. However,
when people look to purchase items on websites like this in the
majority they are looking for the cheapest options and this will include
the price of shipping. A higher shipping fee will contribute to making
the overall price much greater than the product is worth and unless your
product is one which is truly unique, the chances are that a buyer will
be able to find a cheaper option from another seller.

You can look at things like Priority Mail Services which is a
preferred shipping method for many, this is because it offers a good
trade off between delivery speed and costs – items are usually delivered
between 2 and 3 days. There is the option of flat rate fees for small
packages such as small boxes, flat packages or envelopes, which means it
is a lot easier to calculate a shipping cost upfront and with this
option it doesn’t matter where your buyer is located as the price will
always stay the same. As well as low costs, people also want speedy
deliveries and with the thousands of sellers online today this is a
buyer prerogative, international sellers can rarely secure guaranteed
next day deliveries which can put them out of the running for many
sales.

As with all businesses, expenditures are something which should only
be 100% necessary, and if your business can stay afloat without the
option of international selling then this can save you a lot of money in
the long run – even down to saving money on containers and packaging
for long distance transportations and the price of listing items online.

If you do choose to ship internationally, you may prefer to look at a fulfilment warehouse to house your products and organise the distribution to specific countries in order to keep costs down.

3PLs (third party logistics partners) have been a vital part of the supply chain for years, but
the role they play in the supply chain continues to shift as economic
conditions change. They now handle everything from raw materials to
finished products, packaging, and order fulfilment. Experts tell us that
the evolving business models of these 3PLs are a major force behind the
growth expected for the consumer products industry in coming years.

What type of services does a Third Party Logistics Provider offer?

Most of the work 3PLs do remains transportation, pick and pack and fulfilment services, but many are adding supplementary services that make operations more efficient, and more profitable for their clients

Consumer goods manufacturers and retailers alike are moving from a
model where 3PLs are treated as purely tactical partners to one where
they are considered full strategic partners. As these logistics
providers add capacity and capabilities, especially automation and
software resources, they are becoming much more adept, and efficient, at
managing supply chains than the companies they typically work with.
Shippers, retailers, and ecommerce sellers alike need to think about how
they can use, and profit by, these new capabilities.

Leveraging a 3PL’s capabilities

Bring your 3PL into your core team. Include them in strategic
planning and assessment. One of the largest losses in efficiency when
outsourcing aspects of the supply chain is in poor communication and
lack of understanding between partners. Working closely with a 3PL can
have great benefits for both of you.

Seek out ways to reduce the number of separate providers in your supply chain

This will serve both to reduce cycle time and to improve overall
efficiency. 3PLs offer a lot more services now than they used to, and
fully utilising these services can take a lot of smaller providers out
of the chain entirely. Many 3PLs offer supply chain management services
themselves, and can take care of this kind of analysis for you.

What can we expect from 3PLs in the future?

We are on the verge of a third era in the relationship between 3PLs
and their clients. Once a client approached a logistics outsourcer with a
simple job to do. Today, they need 3PLs to do a job, but to add
expertise and innovation to do it faster and more efficiently. Soon,
organisations, SMEs and individual e-tailers will ask 3PLs to help them
plot the best and most effective course forward with a set of related
business challenges.

E-commerce can be a very rewarding, efficient way to do business, but
you have to organise properly if you want to get ahead. Most
‘e-tailers’ or ecommerce sellers prefer to begin with the help of an
experienced warehousing, distribution and fulfilment partner who
can handle the whole ‘back end’ of the operation, while the merchant
focuses on business and sales, maintaining the website, and any other
sales channels that they have developed.

So what’s involved with starting an e-commerce business?

Your suppliers

Whether you buy completed products or you being in raw or finished
materials and produce the products yourself, you have a list of
suppliers who provide your products and materials. If you deal in
finished products, you can have them delivered directly to your
warehousing and distribution partner, who will make them ready to be
sent to the customers. If you do some or all of the manufacture
yourself, you’ll need both materials and finished goods storage, and
more transport options.

Stock

Once you’ve sorted your suppliers out, you need to determine just how
much finished stock you should keep on hand to fulfil your orders. Most
start-ups will adopt a ‘pull strategy’, where inventory levels are
responsive to demand. This is especially useful in the early days, when
demand is hardest to predict. Your warehousing partner will receive and
store your stock, and keep you apprised of current stock levels, as well
as your supply relative to current demand.

Packaging

Your packaging is important, not just for transport and delivery, but
for brand identification and marketing. You will need to make this
available to your W&D partner, unless you do your own package
finishing.

Transportation

Your fulfilment and distribution partner will handle the day-to-day
aspects of transportation, but there are many choices to make. Delivery
methods, shipping charges and many other variables will change depending
on exactly what your product is, and what your sales volumes are. Your
logistics partner can help you make these decisions.

Sales Channels

Will your orders come from your own ecommerce website? From eBay or
Amazon? Multi-channel ecommerce is important, and it is just as
important to work out where your orders will be coming from with your
warehousing and distribution partner early, so they can provide services
best customised to your needs. Orders may go through you to your
fulfilment provider, or they may go directly to the provider.

Customer Service

Fast and accurate order fulfilment is important, but exceptional
customer service is not to be ignored either. Happy customers are return
customers, after all.

Customer experience is your number one priority as an ecommerce
seller. You have a lot of competition, and your customers can probably
get essentially the same product from quite a few other sellers. Once
they have spent money with you, they are more likely to go through you
again, but only if they receive the level of customer service they
demand.

1. The human touch.

Managing customer interactions is key to repeat business. If there is
a problem or a question about an order in progress or that has already
been delivered, your customers need to feel that their concerns are
being addressed. That there is an actual person whose job it is to sort
things out for them.

Ironically, a return or a problem with an order can win you a
customer for life, if it is handled with care and respect. If you (or
we) go above and beyond customer expectations when something goes wrong,
they will come back again and again.

2. Use technology to connect your customers to help, not as a barrier.

So many companies are using technology as a substitute for human
customer service personnel. Making it all but impossible to talk to a
human being. The customer hates that. One frustrating experience
pressing ‘0 to hear these options again’ for 45 minutes can lose you a
customer forever. Technologies like live chat are now easier to use and
less expensive than telephone customer support, and give customers the
interaction they demand when something goes wrong.

3. A good returns policy can be worth an entire customer service department.

Consider adopting a no questions asked, completely free refund or
replacement returns policy. It does cost money, but customers are a lot
quicker to part with their money if they aren’t worried about having to
pay £10 to find out they don’t like it once they get it home. This is
the one real advantage brick and mortar stores have over ecommerce; you
can just take it back without spending any more money.

I cannot over stress how much customers resent spending even a pound
to send something back once they decide they don’t want it. Most will
get a replacement from a competitor instead, even if the price
difference is greater than the return cost. It isn’t rational, but they
do it. Free returns also mean you don’t need someone to try and win them
back once they get angry.

Time is your most valuable commodity. It is just about the only thing
you cannot buy. How you spend your time determines your productivity
and, ultimately, your business’ profitability.

So, how much of your precious time do you or your people spend doing
things that would be better, and more quickly handled by a 3PL?

How many hours, how many thousands of pounds, have you spent storing,
sorting, packing and shipping goods when you could have been
innovation, marketing, and just plain selling them? How much work could
you have done to improve your profit margins if you hadn’t been moving
actual units around, sending invoices, and processing payments and
returns?

Worse, customers are demanding more and more attention to order
fulfilment and shipping. They demand rapid turn around and complete
accuracy. They demand the best shipping rates and the fastest delivery
times.

It is difficult to specialise in both your business and in order fulfilment

Luckily, you don’t have to. If you find that you are losing time and
productivity with warehousing, shipping and other logistics matters, you
may well need a fulfilment partner. Using a 3PL, or third party logistics partner provides two primary advantages.

First, you can spend your time where it is needed most: growing your
business. Improving your processes, increasing sales, and doing
everything you got into business to do in the first place. This is a
competitive time. Every minute you’re not pulling ahead, you’re falling
farther behind.

Second, a good fulfilment house is a back-end specialist. They excel
at it the same way you excel at the front end. A good 3PL can handle
everything from stock warehousing, supply chain management, response
handling, rework of products, pick and pack, hand finishing, enclosing,
order fulfilment and distribution. Logistics is what they do, and they
do it exceedingly well. Because they work with so many different
sellers, they can run a full featured, large, modern facility and still
save you money over doing your own order fulfilment.

We all know how tough the market is for ecommerce sellers today. For
your business to become everything it has the potential to be, you need
to be as efficient as possible. To do that, you need to find the right
partners and work with them to meet your customers’ needs better than
your competitors can. A good fulfilment house can make it all work for
you.

Small online businesses and e-commerce start-ups have their own
unique set of needs in terms of order fulfilment. Order volume may be
very low for a time. It will almost certainly be inconsistent, at least
at first. Small concerns cannot handle high setup costs, large monthly
retainers or fees, or minimum order requirements. It just isn’t
practical at that scale.

Still, that doesn’t mean start-ups have to do their own order fulfilment

A good fulfilment house can handle more than just orders. They can manage the entire back end of your business, warehousing, pick and pack, distribution and delivery, even hand finishing, enclosing, and returns. They should be able to offer e-commerce start-ups the right price, as well.

1. Transparent operations and pricing is especially important to
start-ups. Fine print and hidden fees can be an absolute minefield for
small businesses. Some fulfilment service providers cannot integrate
their software to the merchant’s, and so the seller is forced to invest
in compatible software, or deal with a completely opaque provider.

With a good fulfilment partner, the process is extremely simple and predictable for the merchant

So many fulfilment houses get this wrong. If the process is overly
complex, online sellers cannot easily predict their monthly costs. SMEs
and start-ups would sometimes rather go it alone than risk costs going
higher than they budget for, especially in the very beginning.

Proper software integration should allow even the smallest ecommerce
seller to see every detail of their storage and fulfilment status with a
few mouse clicks. The smaller an operation is, the more important every
single order is.

2. Flexible service is vital. Smaller businesses cannot risk locking
themselves into rigid, ling term deals, and they can’t risk agreeing to
high minimum order volumes. One bad month could mean disaster in that
kind of scenario. Outsourcing their order fulfilment function is
supposed to give ecommerce sellers a competitive advantage. It should be
flexible enough to help them along when they are just starting out, and
then expand with them as they grow and thrive.

3. Reliable service cannot be under-valued. Businesses of all sizes
use fulfilment and distribution partners, and every one stands or falls
on the reliability of the service they provide. While no provider can
boast 100% accuracy 100% of the time, they can, and should, strive for
it anyway. High quality customer service and returns handling can smooth
over any feathers that do get ruffled.

Everybody loves a surprise – Three things (besides the order) that should be sent in the shipping box

A good order fulfilment partner is a powerful marketing tool. Hand finishing and enclosure can be a great way to communicate with customers, and keep them coming back for more.

1. Coupons

A few people never even look at them, but most of us are delighted to
find a coupon for something we knew we were going to buy eventually
anyway. Better still when we find one that makes an offer too good to
refuse for something we had already convinced ourselves we couldn’t
afford.

Email offers and printable coupons are good, but an actual paper
coupon can make a customer shop with you again more quickly, or be
passed on to friends and family, making you a new customer entirely.
Better still, they cost nothing to ship inside an existing order. The
most effective coupons are broad and non-specific. 20% of any order over
£50 will have a higher take-up (and a smaller nip into your margin)
than 33% off a specific product. ‘Free shipping on your next order’ is
good to encourage them to come back sooner.

2. Free gifts

This really turns heads. Say a customer just bought three t-shirts.
Why not send a fourth with your branding on? Not only will they
advertise you, they’ll be grateful for the gift. They might even order
from you rather than a competitor, just in case they might get another. A
nail polish order? Why not include a sample of the new line you’ve just
started carrying, and a coupon for more? Fast take-up of new lines is
money in the bank.

This one is great for word of mouth advertising, too. Maybe she
doesn’t use that colour. Maybe he doesn’t like that team. They’ll pass
it along to a friend, and the story of how they got it. Everybody loves
free stuff.

3. Review requests.

This one isn’t as exciting as a sample, but it can do you a lot of
good. People see email review requests as spam, and ignore them. A
printed request along with the item ordered is more likely to be seen
and read, and it will get them back on your website that much sooner.
You get valuable feedback, and they become familiar with your review
page. They might have a look at your other highly-rated products, and
you’ve got another sale or two out of it.

Whilst choosing the right fulfilment, distribution, and supply chain
management partner may be the most important step to success as an
e-tailer, there are quite a few things you can do to make life in
e-commerce easier on your end as well.

Let’s take a look at how you can improve your e-commerce business

First, keep your inventory close to your customers.
If you are only going to have one warehousing and distribution point in
England, that means using a fulfilment house in or around greater London.
Even if you have several fulfilment partners across the country, you’ll
need one (or more) in the South, near the largest population
concentrations.

Shipping and transport costs continue to rise, especially for
individual order-scale shipping. The closer your products are to your
end buyers, the less these increased costs will affect you, and the
greater your profit margins will remain.

Second, make sure you are selling across every
possible channel. Do not be the last one to jump on the multi-channel
band wagon. Selling to retailers, whether brick-and-mortar or online
marketplaces like Amazon, lets you tap into a huge distribution network,
as well as benefiting from their marketing and name recognition. You
pay for it, though, by selling at wholesale prices. It’s an excellent
way to sell your products, but it should not be your only way.
Similarly, if you sell only from your own website or online store, you
get full value for your own marketing efforts and hard-won name
recognition, but you miss out on the kind of broad exposure that can
make that work really pay off.

You need to diversify your sales strategies. Make the benefits
reinforce each other, and try to make the disadvantages cancel each
other out. Then if your website goes down for a week you don’t lose all
of your income. If Amazon’s credit system gets hacked, you still sell
product. Don’t overlook international distribution partners, either.

Third, you need to specialise. Find your niche, and
fill it. Most of the goods sold online today aren’t ground-breaking.
They are everyday products that common people need – by the millions.
Most ecommerce sellers have a lot of competition, so you have to focus
on your strengths and provide something unique to the customer, even if
it is only a unique shopping experience. Something about you, either
your design, your manufacture, your website or your service needs to
stand out.

That means it is often most efficient to partner with a top quality
fulfilment house, who can handle your entire back-end, and let you focus
on your strengths. Every minute you spend not playing to those
strengths is wasted.

How to keep them coming back with an e-fulfilment strategy

Ecommerce retailers know how vital return business is. One way to make a long term customer is to use a quality fulfilment house, and to work closely with your e-fulfilment strategy with your fulfilment partner.

The right fulfilment strategy can be the difference between a
satisfied customer and a truly happy one. The wrong one can leave them
disappointed, or even angry enough to leave bad reviews.

So, what strategies work well across different sales channels?
It might sound a little old fashioned, but people still love coupons.
These could be emailed to customers, they could appear on your website,
and you can place them with one of the many websites that specialise in
featuring coupons. I’m sure you’ve already done most of that.

Consider this, though. Your customer is finally opening your package.
Right on top, the first thing they see is an old-fashioned paper
coupon. The kind of thing they’ll stick to the fridge or put in their
desk drawer, and will be a constant, offline reminder about your
company, and that particular product.

Does your fulfilment house offer to pack coupons with your shipments? They should.

There are many types of coupons, and you should try a few as test
runs before settling on a strategy. Options like money off your next
purchase, free shipping on your next purchase over £10, or even a free
50p gimcrack with your next order have all done wonders for some
retailers.

Free samples can also get you a lot of attention.
Everyone’s ears perk up at the word ‘free’. This won’t work for all
e-commerce sites, but discuss with your fulfilment partner what it would
cost to send free samples to existing customers twice a year, or to
include free samples of new or slow-moving SKUs with certain kinds of
orders – all orders over so many pounds, etc.

The samples can be arranged seasonally, or by similarity with the
last product bought, or by any other metric you track. Consider how much
personalisation you can afford, and how much return you can expect from
it first, but a free, unexpected package makes a customer feel
appreciated, and mean a lot more than any number of Google AdWords
placements.

There may even be more that a good fulfilment partner could do for
your e-commerce site. Ask. You’d be amazed what we can do these days.

How can I move my slow moving inventory part 4:

In our last few posts, we’ve looked at how to identify slow moving
inventory with the help of your ecommerce fulfilment partner, how to
market it better on your own website, and how to get the most ROI on it
when it is time to cut prices. Better still if you didn’t get into that
kind of trouble in the first place, right?

Planning to prevent SMI can be difficult. When you first start
carrying an item, it can be easy to misjudge demand, and you almost
never know what the most efficient order size would be. EOQ, or Economic
Order Quantity, is the order size that maximises your profit in a given
time, considering unit price, mark-up, turnover, delivery and fulfillment costs.

The first time you order stock, that is mostly guesswork

So, step one is to determine EOQ as accurately as possible
before making the first order. Look at similar items you already carry,
especially items from the same manufacturer or distributor, if
possible.

Look at how much marketing effort you put into the existing item, and
don’t expect the new one to sell as well if you do not spend that kind
of effort on it. Consider the carrying cost per unit as well. If the
carrying cost increase for stocking twice as many units destroys the
volume buying price reduction, you would be creating slow moving
inventory. Especially if it is your first time carrying this item, be
cautious, and buy small. These are no the economic times to be taking
risks, especially for ecommerce retailers. Amazon can afford to lose
money every quarter, but you cannot.

Step two is to keep your marketing campaigns aggressive, active and interesting.
Change your product categories once in a while. Make sure your customer
database is accurate, up to date, and tracks important data. Ecommerce
is about small companies, for the most part. While being small has
several disadvantages, it allows for a great deal of agility. Try to
walk the line between your site and marketing efforts being too boring
to attract new customers, and being too chaotic to give return customers
the comfort of familiarity.

Above all, don’t be afraid to discontinue offering products that just don’t sell.

How can you move your slow moving stock part 3:

So You’ve got some problematic inventory, and it just isn’t moving
the way you’d like it to. Marketing and SEO have only done so much, and
it’s time to save a sale.

Email campaigns

Before you go cutting the price and giving up your margins, look at a
personalised email campaign. Not spam, but emailing those of your
customers who have shown an interest in similar items (and have not
opted out of receiving promotional messages).

Or, on a related note, your website can be geared to respond
differently to different customers. Maybe you should have a banner on
the landing page that promotes SMI which is tied by category or type to
known customer’s habits, and shows a mix of popular and SMI options to
unknown customers.

Now, when you’ve tried all that, and still aren’t getting good
numbers, you can start cutting prices and know you aren’t throwing away
money.

1. The clearance page

Ecommerce was founded on the concept of the bargain, and reduced
prices still have customers pouring over comparison sites with a
sometimes frightening intensity. If they are willing to shop around for
two hours to find their copy of the Robocop Blu-ray for £1.50 cheaper,
then give them what they want. Reduce the price for a while, and feature
it with other reduced items, and see if any interest develops.

2. Daily deals and one-time only offers

are
particularly amenable to special website sections, and email campaign
tie-ins. Daily, or even weekly deals create an artificial sense of
urgency as well, and can garner you impulse buys. They are also easier
to ‘leak’ to bargain hunting sites. Plus, anyone who comes looking after
the sale has run may still buy at your normal price. Just don’t let it
devolve into bait-and-switch.

3. Deal sites and liquidators are kind of a last resort,

as it means giving up on most or all of your margin, and getting what
you can while reducing inventory. Sites like Groupon can help you move
overstock for a price. You won’t make much, if any, profit, but it’s
better than throwing the lot out. Liquidators can be even worse, as you
know you’ll be taking a loss, but again, you got something back. And
you’re not paying to warehouse those 1000 lime green size 30 Harry
Potter pyjama tops anymore.

Now that you have a strategy for clearing your existing SMI,we can look at ways to prevent it from happening in part four, coming soon.

What to do about slow moving inventory part 2:

Slow moving inventory can be the bane of ecommerce retailers without them ever knowing it. It can take up expensive warehousing space,
and it keeps your capital tied up and vulnerable. Working with your
e-fulfilment partner to define your slow moving SKUs is the first step
(see my last article), but then what?

Most e-retailers instinctively reduce the price per unit, and hope to
sell off the overstock. This can be a mistake, and result in
substantial loss of the capital that that stock represents. Some careful
analysis first could save you a lot of money.

Marketing your way out of SMI

Have a look at the state of your marketing efforts and see if you can
find a reason that SKU isn’t moving as fast as you’d hoped. After all,
marketing is the core of e-commerce, from your point of view.

First, look to your website(s). How easy is it for visitors who have
never been before to find these items? The bigger your ecommerce
catalogue, the harder it can be for visitors to even find some products.
Is it doe to shortcomings in your on-site navigation tools? Are the
slow SKUs just buried under the faster ones? Make sure all of your
products can be found quickly using internal and browser navigation
tools. If they cannot, try moving your slower items to the tops of your
category pages, or see a web designer about implementing a better search
function.

Now, let’s examine your images. Once you’ve navigated to the product,
how good does it look on your site? Compare the pictures of your SMI to
your faster products. Is there a substantial difference? Do your slower
SKUs have fewer, or poorer quality pictures? If so, fix this. If it
looks like you, the shopkeeper, consider these to be ‘lesser’ goods,
what else will the consumer think? Do the same analysis with your
product descriptions. Are they boring, confusing, or worse, misspelled?
Now, let’s look at your SEO efforts.
What page does Google have you on for your slower moving inventory? I
don’t need to tell you how few googlers go past page two. If it is a
problem, look to optimise your categories and product details. Make sure the description isn’t just copied from another website. Google hates that.

Try this for a few weeks, and see if that moves any more product. If
not, then consider sales and promotions, which will be the focus of part
3.

SMI (Slow Moving Inventory) is, of course, a relative term, and one
business’ SMI can move a lot faster than another’s A list. Building a
definition specific to your operation is the key to dealing with SMI
appropriately.

This is a particular concern for ecommerce retailers, as many of them use e-fulfilment services and may not be aware of the speed some of their SKUs move.

Three factors are generally the most relevant in e-fulfilment, and we will explore them

Overstock

This is an important concept, but overstocked inventory is not
necessarily SMI, nor is SMI by definition overstocked. Overstock is any
inventory that you have had six months’ worth of stock built up for more
than twelve months (to differentiate from building up for seasonal
demand). If you use this definition of SMI, as some do, you ignore the
shipment frequency factor, and get false numbers.

Inventory Turnover Rate

Many retailers define SMI by stock turns. This is a more useful
method, as low turnover items share a lot of the same drawbacks as real
SMI, but this definition ignores order size.

Larger orders are generally less expensive per unit, but taking
advantage of that means slower stock turnover. If it works out cheaper
to buy a year’s supply of widgets, even after accounting for storage
costs, it would be wrong to define it as SMI, because it isn’t
problematic inventory at all. E-commerce retailers need to be conscious
of the dangers of storing too much of anything, though.

Shipment Frequency

Possibly the most useful definition of slow moving inventory is tied
to the frequency of outbound shipment. Look at it in terms of SKUs. If
you have shipped zero of a particular SKU over the last 3 or 4 months,
then it is probably slow moving.

Again, the ratio of days to units varies greatly, depending on your
business. I know a few people who would be thrilled to move 4 units a
year, but they are very expensive units. Each seller must define their
own threshold, but it should always be defined by the unit/day ratio for
the best and most useful numbers. Your e-fulfillment partner can supply
you with these numbers, if you do not already have them.

Now that you can determine which of your SKUs are slow, you can
decide what to do about it. That is the subject of part 2, coming soon.

We’ve all heard about omni-channel marketing (wasn’t it just
multi-channel last month?), and how it is supposed to be the next big
thing. Most of us have decided that this time it’s not all hype, and we
should brace ourselves for the inevitable changes in the industry.

That is exactly the wrong kind of thinking. When a big change comes to any sector, there are three types of responses.

1. Early adopters.

Early adopters jump on the new way of doing things before it has even
fully evolved. They take risks with untried processes and systems, and
ether fail spectacularly or succeed and shape the market.

2. The just-in-timers.

The next segment of the industry has watched the early adopters sink
or swim, and sets up their own versions of the successes and steers
clear of most of the failures. They don’t take the big risks, and gain
moderately but lose little.

3. The Johnny-come-latelies.

These are those who couldn’t afford to adapt or refused to see the
change for what it was until it was basically too late. They didn’t
adopt any new strategies until the old systems had already failed, and
they are marginalised because of it. Only those with the strongest
brands and deepest coffers dare take this rout on purpose.

So, where are we now? The early adopters have come and gone. Most of
them did poorly, as expected, and the successes are well established.
The just-in-timers are just about all settling into their new grooves,
and reaping the modest, careful rewards they expected. In six months or a
year, only the dinosaurs will be left.

What, then, is to be done? Make your supply chain investments
now, while you can still claim your share of the omni-channel market.
Yes, it will cost more. Yes, I’m afraid it will shrink your margins in
the short and even medium term, but it will keep you current and
profitable in the long term. We’re at a point when we cannot just wait
for the change to become inevitable before we adapt. The process takes
too long, and we would be left behind long before we found out feet in
the Omni-channel markets.

Not long ago, e-fulfilment was exclusive to retail operations. Now,
though, a number of B2B and wholesale businesses are edging into the
ecommerce fulfilment market. Historically, B2B operations of any kind
have not been as focused on good customer experience as retail (or
etail) operations, and fulfilment was seen as unimportant to the
customer experience, unless and until something goes wrong.

How is ecommerce fulfilment becoming more popular with B2B businesses?

We all know that things have changed in that regard for the B2C
market, but things are shifting for B2B businesses now too. B2B markets
are no longer product driven. There are just too many competing
providers out there, and the internet makes them too accessible for
that. In just the same way that the .com era changed consumer
fulfilment, this level of access has changed how businesses shop as
well. B2B fulfilment is just as important to building and maintaining your brand, reducing costs, and achieving strategic goals, and is now of importance to these companies’ marketing departments.

A good B2B fulfilment provider
should cater to their partner-companies’ customer experience needs, and
be aware of how different businesses value different aspects of this
experience. Being able to customise your service to the unique needs and
business positions of the client has always been key to fulfilment, and
this is really no different.

A good fulfilment house provides seven basic factors to their B2C clients:

Helpful, fast resolution of customer issues

Good old fashioned ROI

Recognition of the client’s customers, and their experience

True fulfillment – meeting all obligations just as described

Integrated, personalised service
6. Professional competence

Good client (and customer) access

The best ones know to provide a slightly different list for B2B clients:

Personal, intelligent contact

Flexible procedure and policy

Sensitivity to the client’s business needs

Pro-actively working to meet those needs

Full follow-up and performance analysis

True fulfilment

And, as always, ROI

While True fulfilment and ROI are on both lists, the rest differ
substantially. Appreciating these differences and how best to provide
the right customer experience to each of one’s clients is the key to
doing well in both markets, and doubling the list of potential clients
in the world.

Early point of sale (POS) management used to simply be a case of entering a few numbers into an oversized calculator, waiting for the ping! and
making sure you handed the customer the right change. Nowadays,
customers find the sight of a traditional cash register an antiquated
quirk; a relic from the Museum of Retail Experiences.

When POS systems that used barcodes and scanners were introduced to
shop fronts across the retail industry, they quickly became an
established tool for automatically recording sales and stock levels, as
well as customer loyalty schemes and discounts. As retail sales grew, so
did the need for bigger and better POS management software.

So just how have POS Management changed exactly?

Today’s POS management systems have become faster, more intuitive
machines that not only help business owners finalise a sale, but assist
with the overall running of the business. In the fulfilment industry,
the same POS management systems have radically improved communication
between client and warehouse, leading to better business relationships
and smoother supply chain management.

The processes behind order fulfilment have had to adapt to a changing
environment, and POS software has been instrumental in helping smooth
the transition to the world’s new favourite way to shop: online.
Compared to most bricks and mortar stores, which have designated opening
times and depend on staff to run them, online stores are essentially
open 24/7 all over the world, and a sale online will go directly to the
fulfilment centre to be processed.

Retailers expanding into the lucrative business of e-commerce have unlimited resources with POS management software. Most systems can now be fully integrated with your e-commerce business, bringing benefits such as inventory management across both online and physical stores.

With Cloud based POS management systems, business owners can also
check stock, view sales statistics and customer trends on the go via
tablets or smartphones, or anywhere with a web connection. All the data
is backed up and simple interfaces mean that even technophobic retailers
can quickly launch an effective online store.

It’s a far cry from the old fashioned way of selling goods, but
combining your e-commerce fulfilment with a fully integrated POS
management system can make a huge difference in the amount of sales you
make.

Lawrence (real name withheld, he’s not ready for the kind of instant
fame that comes from being mentioned on our blog) runs a custom clothing
silk-screening and printing business.

A few years ago Lawrence discovered the internet in a big way, and
customers from all over England have discovered him. The problem is,
Lawrence wasn’t really ready to expand as much as he has, recently. The
move from doing business on a walk-in basis from his shop to printing
and shipping hundreds of garments a week trough eBay and his own website
has led to 12 hour days and a shop, and apartment, completely full of
inventory.

“I couldn’t even have friends over – my outbound orders were piled up on my couch.”

It didn’t take him long to find one who knew how to advise him on how to move forward.

As it turns out, 90% of Lawrence’s orders are for three t-shirt
designs, so he was able to integrate his eBay and online shops with
their system. Now, he spends his time dealing with walk-in customers
like before, and overseeing a pair of part-time employees in the back
room who make up the bulk of his inventory every week. Once a week a
lorry comes from his provider to pick up the t-shirts, already boxed by
type, and store them ready for ordering. When an order comes in, they
handle the picking, packing, and shipping, and the money finds its way
to Lawrence (minus a fee, of course).

Lawrence has actually been able to step up production, and is
considering moving to bigger premises. Best of all, though, he has his
life back. “It’s not just being able to see my couch again, but that is
nice. It’s having time in the evening to sit on it again.”

Like Lawrence, you can reap substantial benefits by finding the right warehousing partner.

It takes a lot of trust to let an outside company manage and perform
some of your most vital business functions. Fulfilment is one of the
most vital points in your logistics chain. Getting it right can make
things very easy for you, but choosing the wrong partner could put the
nails in your coffin.

When choosing a fulfilment company, or deciding whether to stay with your current arrangements, consider how the competition stacks up for the following services.

Order retrieval

Many older concerns put orders into their system in batches before
sending them for packing. This used to be the industry standard, but it
causes unnecessary delays and adds processing time before the order even
goes out for picking. Better to use one that sends orders for picking
automatically as soon as they arrive.

Timely reporting

Ideally, you want live reporting. You need your orders despatched
promptly, and you should have the ability to check up on this at any
time over the web. Look for a provider that gives you a detailed snap
shot of the fulfilment status of all of your orders on demand.

Technological reliability

Ask how they handle data exchange, and how they plan to integrate
with your systems. Ideally you want a combination of an open API and
simple, fault-free integration. And my daughter wants a unicorn. Still,
look at what they offer, and decide whether it will actually work well
with your systems before you make a choice.

Management of stock or inventory

This varies between non-existent and stellar. Depending on the goods
you work with, you may need best-before-date management and batch
control capability. You should be able to tie important markers into
alerts as well.

Customer service quality

This is one you can test yourself. Find out who they work for
already, and order something small and cheap. Ring in and test out their
actual on the ground customer service people. See how well they
actually do. You might have to do this a few times to get a feel for the
place. Also look for whether they use a ticket system for problems. It
is generally better if they do.
Returns
Make sure they handle returns as well. Being forced to use a second
3PL (4PL?) for your

returns

can be a nightmare. Again, order and return a
product to see if they do returns well.

As order fulfilment is one of the most important parts of any
business, it is essential that it’s done properly, which often means
investing a lot of money into setting up an efficient supply chain,
particularly if you’re just starting out.

If you’ve chosen to partner up with a fulfilment centre then you
won’t have to worry about the big decisions regarding your order
fulfilment – the professionals will take care of all that and it will
usually cost less than if you were taking it all on yourself.

Let’s take a look at how you can reduce your order fulfilment costs

Try “kitting” your products

Kitting is the industry term for combining or preassembling prod just starting out.ucts
into ready made packs, such as popular 2-for-1 deals or items that
people regularly purchase together. If you are able to do this before
sending your products to your fulfilment house, you can end up saving a
lot of money per item because the fulfilment house spends less time
putting together the packages themselves.

Double check your orders before sending them out

Taking the time to check your products before they are sent to your
fulfilment house can reduce mistakes that must then be dealt with by the
fulfilment company, or even returned back to you to fix, the cost of
which can eat into your profits unnecessarily.

Reassess your workforce

When you have established a relationship with your chosen fulfilment
house and everything is running smoothly, it might be time to take a
look over your remaining workforce and see where there are excess
bodies. You don’t necessarily need to cut your total number of staff in
two; you could use the now freed up employees to increase the marketing
and advertising side of the business, encouraging growth.

So those are just a few of the many ways to lower your costs even
after you’ve outsourced your fulfilment, and the best part is they’re
simple to put into practice and won’t cost you a thing!

When helping an e-fulfilment
client put their house in order, some of the most frequent problems are
with SKUs. All too often, the merchant has only a handful of inflexible
SKUs, or an unmanageable array of to-small units. A good rule of thumb
is that you should have fewer SKUs than the number of orders you
despatch each month, but this can vary greatly by industry and product
type.

So, how many SKUs should you have?

First, take a look at the market you sell in. How does it respond
when you stock more or fewer items? What happens when you reduce the
number? You may see a cooling of interest due to lack of choice, but you
are just as likely to see an upswing, as too many choices can confuse
some consumers.

And if you increase your SKU count?

Some industries demand exactly what they want exactly the way they
want it. Especially of you are supplying tradesman or industry
professionals rather than standard consumers, you may need to stock a
thousand separate widgets. Too many SKUs will increase your overhead
though, as you will need to keep a lot of units in stock. It will also
tie a larger percentage of your value up in merchandise, which goes
against the current ‘lean’ practices.

Of course, you could just cheat.

Have a look at your strongest competition’s website. There is no
better source of intelligence on the enemy’s position in the market. If
they sell to the same market, and are doing well for themselves, model
your system after theirs. If they only have a handful of SKUs that move
like hotcakes, you may do well to make sure you have analogous products.
If they (and you) sell to consumers who demand a lot of choice then you
won’t do yourself any favours by limiting your stock.

When it comes to order fulfilment, it’s no surprise you want the best service available. A successful fulfilment company equals
a successful supply chain and there are many companies out there
promising the world, especially when it comes to the final part of the
process: distribution.

Some fulfilment companies split their courier services between third
party distributors, while others manage distribution in-house. But how
can a fulfilment company with an on-site courier service improve the
overall effectiveness of your supply chain?

A complete understanding of worldwide order fulfilment

International shipping can be a minefield, not least for
inexperienced business owners. Legal jargon, customs laws and shipping
restrictions that differ from country to country can stand in the way of
company growth. With a wealth of first hand knowledge and experience, a
fulfilment company with its own courier team provides a simple solution
for all your international order fulfilment.

Cost effectiveness

When a fulfilment company outsources their distribution to a third
party company, it can sometimes include additional costs that a
fulfilment house with its own courier service can provide automatically,
usually for a much smaller, or all-inclusive fee.

Avoid miscommunication

Order fulfilment is a complex process. Splitting it up to be managed
by different companies is often the first step towards miscommunication;
packaging details can be overlooked or misinterpreted by a courier
unfamiliar with your goods or even the fulfilment centre itself. Keeping
the most important elements of your supply chain under one roof can
help reduce these mistakes.

Flexible and adaptable service

During busy periods and quiet lulls, a fulfilment house with its own
distribution fleet has the resources to maintain a consistent delivery
service, keeping your customers happy and your costs low.

Expert packaging know-how

The best people to send your goods out into the world are the people
who helped store, package and assemble your products. Why? Because
they’ll know everything there is to know about the best ways to protect
your goods all the way down the supply chain, from the minute they reach
the warehouse to the moment they’re handed over safely to your
customers.

This year is set to be busy for the logistics industry and as your
company grows, you’ll need more time to invest in other areas of your
business. Outsourcing your fulfilment to a specialist e-commerce or order fulfilment service can take away the stress of delivering products and free up your time to expand your business.

Increased Capital

What company doesn’t want to increase their revenue this year? Well, if you’re in the logistics industry, then outsourcing your fulfilment is one of the most cost effective ways to increase your capital.
By outsourcing, you’ll be saving money on warehouse space, IT systems,
property utilities and pick and pack staff. With a specialised
fulfilment house, processes are already in place to ensure your
operation runs smoothly from the word go.

More Efficient

Fulfilment companies have specially designed rack storage systems in
place to ensure quick and easy access to products, ensuring a
streamlined fulfilment process. Outsourcing order fulfilment will ensure
good customer service and guarantee timely delivery of your products.
What’s more, you’ll have more time to focus on growing your company –
it’s a win win.

Reduced Risk

Investing in a fulfilment service minimises any risk of injury to
your staff and ensures that your products won’t be damaged whilst in
storage or in transit. A professional fulfilment house will have highly
trained, experienced staff to ensure that all operations are carried out
safely and securely. Similarly, specialised fulfilment services
understand what safety and compliance regulations they need to adhere to
in order to ensure that their warehouses meet with current standards.
With a lower staff turnover, a professional fulfilment service will
bring continuity to your fulfilment process and ensure high standards of
operation are met.

Are you planning to outsource your order fulfilment this year? We’d
be happy to answer any questions you might have about using a
professional fulfilment service. Perhaps you already outsource your
fulfilment? How has this impacted on your business growth?

A successful fulfilment service means satisfied customers. From the
moment they add an item to their shopping basket to the point they
unwrap their product, the whole process counts. So we’ve outlined three
of the most essential elements of order fulfilment to ensure a
successful service.

Creating the Right Impression: Packing

A customer’s strongest impression of your service comes the moment
they receive their product, all packaged up and (hopefully) on time.
It’s important not to underestimate the influence that packaging has on a
customer’s experience and attitude towards your service. Make sure that
the correct packaging is used for the product, and this includes any
additional safety or delivery information that needs to be enclosed with
the item.

The Importance of Stock Checking

From a customer’s point of view, there’s nothing more frustrating
than placing an order only to be told that the product is out of stock.
Making sure that you have enough stock to meet demand is one of the most
critical elements of a successful fulfilment service.
Getting your stock quantities right can make all the difference between
a successful fulfilment service and one that leaves the customer
feeling let down. And on the other hand, ordering too much stock can
negatively affect your cash flow as dead stock is only good for
gathering dust.

Delivering the Goods

The final stage in a successful fulfilment process is making sure
that the correct product reaches the correct customer on time and in
perfect condition. It’s of great help to a customer to know when their
product is being delivered and having a fulfilment management system in
place can really help with this. It’s also essential that you know where
a customer wants their product delivered to and if they have a
preference for the time of day.

What are your experiences of using a fulfilment service? What made
that particular service stand out from others that you’ve used? We’d
love to hear your thoughts.

A study of major world industrial markets by Jones Lang LaSalle shows
that on average, there have been four consecutive years of industrial
growth. 2013 represents a 5 year high of world industrial output, and
all indicators predict further expansion in 2014. As a result, warehouse
space utilisation has been growing as well, and distribution and
fulfilment houses have been expanding.

Expansion in 2014 so far has been driven by growing demand for ecommerce fulfilment
and the resulting need for large amounts of sophisticated warehouse
space. As a result, 2014 is set to be ‘the year of e-fulfilment’. The
coming year should see a growing demand for distribution centres with a
robust e-fulfilment infrastructure near large population centres.

However, some supply chain managers are bucking the trend. Smaller,
more specialised warehousing space is in high demand amongst very
responsive, agile shippers. The key feature for such space seems to be
that the space be accessible to fluid distribution channels.

The end result is a very low percentage of unused warehousing and fulfilment capacity. So, what can we expect to follow?

First, demand for space is spreading to various secondary markets.
Because prime space near major cities is drying up, more e-fulfilment
centres will be constructed in lesser, nearby markets.

Second, more such space will be built to suit. Europe and the UK can
be expected to follow last year’s trend in the US, where more than half
of the warehousing space constructed had a lease in place before
construction began.

Third, we can expect rail transport between distribution centres to
increase, as higher volumes make this more efficient than over the road
trucking.

Fourth, e-commerce fulfilment will take over more and more of the
market from brick-and-mortar retailing. Globally, the proportion of e-
versus standard distribution space has been growing by 20% annually.
This trend will almost certainly continue.

When a customer has a complaint, where do they turn? In a bricks and
mortar store it’s normally straight back to the counter or to a
designated customer service till. If that’s not possible, a customer can
telephone a company’s customer care line, where staff are trained in
the art of customer response handling.

Large global corporate companies often invest heavily in their
customer response handling as this is the point where a customer could
be lost forever. Small to mid-sized companies might not have the
financial resources to dedicate to customer response handling and so
there is added pressure to get it right first time.

So how can fulfilment companies help?

An experienced fulfilment house can offer a whole heap of different
services, but arguably one of the best is having an in-house customer
response handling team at your disposal. These teams are versatile, with
experience handling complaints and queries, as well as collecting and
distributing promotional material, customer data retrieval and logging.

But when a customer calls to complain about a product it’s more often
than not an issue directly relating to the condition the goods arrived
in. Sometimes this will be a fault that occurred during the
manufacturing process; other times it will be because of a mistake that
happened during the pick and pack or distribution stage, and who better
to deal with a complaint than the people who made it in the first place?

Finally, letting your fulfilment company take on your telephone
customer response handling also provides your customers with greater
flexibility. Most customers can only call outside of typical 9-5 work
hours, or during busy lunch periods. So when a fulfilment house promises
telephone response handling up to 8pm, 7 days a week, it can settle the
situation and smooth out any issues before they cost you a valued
customer.

Starting your own business is an exhilarating feeling. You’ve taken a
single idea and turned it into a reality, whether it’s selling unique
handmade products from home or discovering a gap in the market that
desperately needed to be filled.

When that business is up and running, you’ll no doubt be involved in
every single part of its day-to-day operations, micro-managing every
little detail to make sure things run as smoothly as possible,
especially where order fulfilment—actually getting the product to your
customers—is concerned.

Order fulfilment tends to be one of the most expensive parts of any business, but it needn’t be.

This is a very simple and effective way of reducing the amount of
packaging you use when fulfilling customer orders. Not only does it save
you time and money on materials, but it’s also environmentally
friendly!

Charge delivery fees

Some companies charge a fee for delivery; others do not. Charging the customer for delivery will help keep your order fulfilment costs low.
Yes, customers are usually pleasantly surprised with free delivery, but
they are often just as happy to pay a premium– as long as their item
arrives on time and in good condition.

Offer a collection service

This works really well if you have multiple branches – some customers
might prefer to collect their items in person; it saves them money on
the delivery fees and reduces the amount of packaging you’ll need to
use. It also provides some face-to-face interaction, which is great for
building customer relationships.

Outsource your fulfilment to Fairway!

Managing your small business fulfilment can be fun – when you’re a
small business. But if you are expanding and sales are growing, then
you’ll need a dedicated team who can take over and provide the same care
and attention to detail that you would give.

Outsourcing your order fulfilment is an investment, particularly when
good customer feedback starts to increase overall sales. Flexible
packages and fulfilment services mean that no matter what you sell, your
business will always be in safe hands.

With e-commerce quickly taking over the high street as the world’s
preferred method of retail therapy, there’s never been a better time for
online businesses to reach wider audiences and strengthen their
customer base.

However, if you’re a retailer who established their brand on the
e-commerce scene a long time ago, but find yourself losing customers
instead of gaining them, you need to re-evaluate your business model and
find the causes behind the slump.

There will always be fluctuations in sales during certain times of
the year, whether you are purely an online retailer, a bricks and mortar
store, or a combination of the two – but a downward trajectory can mean
that something is amiss.

Everything might seem perfectly fine on the surface: your website is
attracting plenty of traffic and your online shop front is appealing. In
any business, this is the customer facing part of your brand, a
reflection of both your company and the management behind it.

Modern customers expect more from online commercial businesses –
fast, efficient delivery and products that arrive in excellent
condition.

But behind the scenes there could be a very different story going on,
particularly when it comes to your fulfilment services. If you handle
all your own fulfilment in-house, there is added pressure to maintain an
effective supply chain as well as keeping up with all the other aspects
of running a company.

If you outsource to a poorly managed or in-experienced fulfilment
house that provides your customers with shoddy customer service, poor
delivery and unnecessary costs, your brand is being negatively affected
without you even realising.

Promising your customers the best is one thing, but if you’re
struggling to keep up with demand on your own, you should seriously
think about enlisting the help of a professional and experienced fulfilment company, otherwise you’ll be hit with bad customer reviews and requests for refunds.

If you want to build your customer base back up to the same levels
you enjoyed when you were at your peak, then providing exceptional
e-fulfilment is one of the best ways to go about it.

Finding the right fulfilment partner can save you time and allow you
to focus on the core aspects of your business. It allows you to grow
your business without the expense of upgrading or expanding your
facilities. Because a fulfilment company will do a high volume of
orders, they can take advantage of the economy of scale to reduce your
overall costs. They are also flexible enough to adapt to seasonal order
fluctuations, and to add new lines easily. They also have the ability to
become warehousing and fulfilment experts. This is
Fairway Fulfilment & Logistics core business, and we have become
very good at it. In the end, you’ll benefit from more efficient
operations and happier customers.

So, what is an order fulfilment partner?

An order fulfilment partner is a business you contract with to
warehouse your stock, pick, pack, and process orders for you, dispatch
those orders, and report various metrics back to your systems to keep
you aware of and in control of your inventory.

I’ve heard a lot about multi-channel fulfilment. What is that?

Say you have a shop on Amazon, one on EBay and one on your own
website. How do you keep your inventory straight between them, and avoid
selling the same stock twice? A quality fulfilment company will have IT
systems that manage multi-channel selling and produce reports that
track your orders and whichever metrics are important to your individual
business.

A fulfilment partner will ensure you do not oversell, and also show
you which channels are doing well for you and which need improvement.
You can use that information to improve marketing and communications
with your customers.

What about meeting customer expectations?

Customers today expect instant gratification. They want their order
in hand tomorrow, or even today. Any delays in order processing or
fulfilment will result in a bad experience and losing return business.
Many customers will abandon a half-completed order if they see the
estimated delivery time is too slow or too expensive.

Again, the right fulfilment house will keep your customers happy by getting their orders out faster and for less.

Running a pick and pack service is all about ensuring the fulfilment of goods and products. On the surface, a successful pick and pack company is
organised, reliable and timely. However, a lot of effort goes in behind
the scenes of a successful pick and pack service and very often it’s
the attention to detail that sets one service provider apart from
another.

Packaging Practicalities

Packaging plays in an important role in protecting products from
damage. Not only does packaging protect products during transition from
manufacturer to vendor, but it also prevents damage when the product is
displayed on shop fronts. A pick and pack service also needs to consider
the type of packaging required for products. For example, some require
corrugated shipping boxes, whereas others need tucked top boxes for
presentation purposes.

Safety Information

Product packaging can also contain important information, essential
to ensuring the safety of consumers. Flammable and toxic products for
example, need to adhere to packaging safety standards and need to
clearly identify the potential risks to customers. Similarly,
ingredients and nutritional information needs to be displayed on
packages containing food.

Brand Enhancement and Customer Experience

The consumer experience doesn’t begin and end with the product
itself. Sometimes, a product’s packaging adds to the customer’s
fulfilment experience. Think about it: how many times have you opened
the packaging of a new product with care and excitement? So, as a pick
and pack service provider, think about how your packaging reflects on
your supplier’s brand and image. Consider what experience the customer
will have when they open their package. Are the contents fragile? Does
the box need insulated padding? The way a package is presented often
plays just as important a part as the product itself.

Although often overlooked, packaging plays an important role in pick
and pack services and can have an impact on the success of other
companies in the supply chain.

How important do you see the packaging process in the success of a pick and pack service?

For many industries, 2014 is shaping up to be a busy year. Planning
for an increase in activity will ensure that your order fulfilment
service runs like clockwork and is able to meet demand. Here are our top
tips to ensure your order fulfilment service operates smoothly.

Review Historical Trends

In order to predict your busiest months, why not review last year’s
fulfilment activity and see which months were particularly busy. There’s
a high likelihood that these trends will repeat themselves this year.
Reviewing historical trends can also help predict this year’s percentage
increases, based on previous year’s growth statistics.

All Hands on Deck

During busy periods, it pays to have additional staff on board who
can make themselves available at short notice. If you predict a busy
month ahead, make sure you plan the logistics in advance. Arrange any
necessary staff training so that new recruits can add real value to your
order fulfilment service rather than simply fulfilling a ‘stand in’
role. This way, you sustain the quality of your order fulfilment while
reaping the benefits of a busy period.

Order Extra Stock from Suppliers

If your predictions are right, you’re going to need extra stock from
your suppliers as the chances are, it’s going to fly off the pallets.
Imagine the frustration at knowing that you could have fulfilled more
orders but didn’t because you ran out of stock. Again, reviewing
historical trends can help you calculate exactly how much stock you’ll
need.

Account for Bank Holidays and Other Deadlines

Make sure you anticipate any fulfilment issues due to bank holidays.
If you outsource your transportation services, will they be running as
many vehicles on bank holidays and will this delay your order
fulfilment? If your fulfilment service relies on the Royal Mail for its
postage orders, it’s worth checking the last postal dates before holiday
periods. Similarly, if you fulfil orders internationally, you’ll want
to check deadlines for international postage.

What other tips do you have to ensure a smooth order fulfilment process?
Perhaps you’re a product supplier, what measures do you expect an order
fulfilment service to have in place to ensure your orders are fulfilled
on time?

Supply chain collaboration can be beneficial for every company
involved. Companies that work together to offer supply chain solutions
often see dramatic reductions in fulfilment time, inventories and costs,
as well as seeing improvements in customer satisfaction and service
levels.

Focusing on Strengths

Companies who work collaboratively often do so in the wrong way,
using collaboration as a means of filling voids in their own individual
capabilities. The most successful providers of supply chain solutions
focus on strengths and use them to their advantage rather than
compensating for weaknesses. By identifying what each company in the
supply chain does well, collaboration becomes easier and more effective
for everyone involved.

Choosing Supply Chain Partners

The most successful businesses might not necessarily be the most
suitable for your logistics services. Many distributers seek to
collaborate with the largest suppliers in the hope that their supply
chain will be more successful. However, this isn’t always the best
strategy as these solutions rely on each individual company’s commitment
to the chain and larger companies are often already involved in other
chains and don’t offer the same financial assurance.

Investing in Performance Management Systems

Companies offering supply chain solutions should invest in an
effective performance-management system to enable all those in the
supply chain to monitor the progress of particular projects and ensure
that they’re delivering the desired results. Companies in the supply
chain should consider using the same performance-management system.
Using the same metrics and working towards common targets can avoid
miscommunications that often damage collaboration efforts.

Does your company offer supply chain solutions? What commonalities do
all companies in the chain share? Do you have a collaborative strategy
to ensure your supply chain’s long term success? Alternatively if you
are looking for supply chain solutions for your business contact Fairway Fulfilment & Logistics today.

1. Complete flexibility wherever you are – With a POS
management system you can actually take orders from anywhere in the
world, wherever you are. Orders can be taken while you’re sleeping and
sent directly to your fulfilment house, leaving you with more time for
everything else.

2. Up to date reports and data analysis – With the amount of
online sales you’re getting it’s definitely going to be tricky keeping
up with inventory numbers and stock levels. A POS management system can
keep track of it all.

3. Consistency across the board – Whether it’s ecommerce
prices that match prices in your stores, or sales receipts that match
stock levels, a POS system levels out the playing field and can flag any
inconsistencies.

4. Getting to know your customers… – When customers purchase
something from you online, you can ask them for feedback at the same
time and store it all on the POS system. This will help you to fine tune
advertising and marketing, tailoring it to specific customers.

5. …And rewarding them for their loyalty – A customer who
already loves your brand doesn’t need any incentive to stick with you,
but it’s a powerful gesture to offer a reward for no reason other than
to say thanks. POS software can show you which customer’s loyalty
deserves a pat on the back.

6. Greater choice for your customers – A large percentage of
the population now has more than one internet ready mobile device: a
laptop, tablet or smartphone. If your retail website is mobile
optimized, then a POS management system will have all of these benefits
while giving your customers more choice about the way they shop.

7. Complete control both off and online – Certain POS
management software can be integrated with both your ecommerce and
physical store inventory, meaning that all your data can be managed more
easily with one interface.

One of the best parts about being the owner of a small business is
that you’re the boss – it’s you who gets to make the rules and oversee
everything, including one of the most important elements: order fulfilment.

If you’re the proud owner of a small business, then you’ll already
know the value of maintaining a smooth fulfilment operation, and will
have probably noticed the hundreds of companies trying to get your
attention by promising the best fulfilment service possible.

“Why can’t I just do my order fulfilment myself?”

Although you might be happy dealing with all your order fulfilment
now on a small scale, it may get harder in the future when your business
grows and you struggle to keep up with demand.

A fulfilment house can deal with orders as they happen. One of the
problems with having a small business, especially one that’s online
only, is that orders can come in at any time from around the world.

This isn’t too much of a problem if it’s 11:30am where you live and
you were just about to head down to the post office anyway; what’s
another order? Just pack it up and bring it with you, right?

But what if you’ve been called away unexpectedly due to a family emergency, or just want to take a bit of time off?

A fulfilment house can integrate their system with yours to
automatically receive online orders, which can then be picked, packed,
and sent directly to your customer without you having to lift a finger.

You won’t even have to hire extra staff or persuade fed-up family
members to help you deal with busy periods like Christmas, Easter or
Valentines, as the dedicated workforce in a fulfilment house can provide
all the extra pairs of hands you’ll need.

So although you might think that fulfilment houses are only for the
big behemoths shipping vast quantities of stock around the world, you’d
be surprised – there are plenty of small business owners taking
advantage of fulfilment companies, just like Fairway Fulfilment & Logistics, who offer flexible packages and years of experience to help you manage your business more effectively.

1) Bulk picking, and re-sorting at the packing station

Granted, it is faster to pick for multiple orders and send them and
the pick lists to the backing area in one container. Still, online
customers today expect, and are justified in expecting, no mistakes in
assembling their order. Any practices that compromise accuracy in favour
of speed should be looked at with a high degree of suspicion. We can do
better than this.

2) Sorting and prioritising invoices manually

Sorting your orders out based on warehouse pick location
requires you to use permanent stock locations. I don’t need to tell you
why this is inefficient. You really should be using dynamic locations
and sorting your invoices by carrier, or some other relevant variable.
The use of handheld barcode scanners and an automated picking route
really helps out here.

3) Several orders and invoices per picking box

Similar to the above problem, this leads to mistakes. If it can’t be
avoided, you should at least require the packer to re-scan the barcodes,
and verify that each is going out with the right order. If it doesn’t
scan correct, then at least you know the problem is still in the box, or
was mis-picked.

4) Pre-printing the invoice, and using it as a manual pick list

We all know that manual picking systems are less accurate than
semi-automated ones, but using the invoice is just sloppy. By the time
it reaches the customer it has been written on, ticked, initialled, and
is usually fairly crumpled. It doesn’t look good, and it makes your
e-fulfilment look unprofessional even if there are no mistakes.

In addition, it introduces another chance for error. The invoice only
says what was ordered, where as one generated after picking shows what
was actually scanned and picked. If a pick error was made, you have no
way to track it.

Love is in the air and so are sales of premium red roses, luxury
heart shaped chocolate boxes and a number of other Valentines Day
products. The majority of these orders will be purchased online and
delivered straight to the intended recipient, with no direct contact
between the customer who purchased the item and the product itself.

With big calendar events like Valentine’s Day, customers like to show
that they’ve put a lot of effort into their gifts. With a gap between
the buyer and the product, fulfilment companies can provide those little
extra touches using professional hand finishing and enclosing teams.
This is also a very lucrative part of seasonal fulfilment as you can
charge a small fee for professional gift wrapping and customers are more
than happy to pay for the service.

So how can a fulfilment company help with hand finishing and enclosing for Valentines products?

Hand finishing and enclosing takes place in the fulfilment house before the product is delivered to its final destination. Hand finishing encompasses anything from pre-assembly to gluing or adding promotional material to delivery order. Fiddly materials that cannot be added by automated machinery (like tying ribbons) are also usually finished in this way.

Arranging hand finishing and enclosing for Valentines Day products
can really win over your customers, especially if they’re often accused
of lacking in the creativity department. When it comes to gifts,
presentation is everything and can even affect how a recipient views the
product.

As chocolate products are perishable, the packaging used needs to
stand up against the storage methods used to keep it fresh as well as
tying in with the Valentines theme. Hand finishing and enclosing teams
can also advise on things like colour coordination, which can help
accentuate details in your product. Pink and red are the colours of
choice for Valentine’s Day, but using other colours in contrast can
highlight the product and also create a different sort of tone. For
example, black and red can imply luxury, high cost and eroticism.

Valentines Day is just around the corner so if you’ve not discussed
your romantic themed packaging solutions with your fulfilment company,
you might be missing out on a financial gold mine.

Supply chain management encompasses every part of the flow of goods
from point A to point B, including sourcing raw materials, liaising with
manufacturers and overseeing the complex chain of networks that make up
the global supply chain.

But simply managing the supply chain on a day-to-day level isn’t
enough; it’s such a big process, it’s hard to see the big picture. Yet
there is a way to plan ahead and guide your company in the right
direction: strategic supply chain management.

In one sentence, strategic supply chain management involves the
decisions and directions a company makes or plans to make in order to
better their supply chain. By using strategic planning in the fulfilment
industry, companies can assess each individual part of the supply chain
and apply their strategies to the whole process.

At the production and manufacturing level, a company needs to keep on
top of its biggest sellers – and those that are slowly slipping out of
public favour by monitoring sales data. By strategically planning ahead
and investing in developing new products or tweaking the ones in
decline, a company can quickly turn a sales slump into a boost in
profits.

Customers of course are probably the most important factor of all, as
they are the ones buying the products, using them, giving positive or
negative feedback either to the company or to their friends depending on
their experiences.

Developing strategic plans where customers are concerned can involve
pinning down your target market, which then leads way to devising
advertising and marketing strategies to target that specific group. It
also incorporates the use of predictive analytics, which is a system
designed to predict certain outcomes in sales.

Strategic supply chain management is most effective when the output
of the supply chain is on par with the company’s overall business
strategy. Changing even the smallest elements can have a big effect on
the company as a whole, and so it’s important that every minor detail is
taken into account.

Ecommerce is rapidly becoming the number one way to sell products, cutting out the need for costly ‘shop fronts’ and all the expenses that come with them.

When you start your search for the right fulfilment house to cover
your ecommerce business, the first question on your lips is probably
going to be “how much will it cost me?”

Every fulfilment company will be different; most will offer a basic
ecommerce fulfilment service that will cover all the essentials
(distribution, pick and packing, handling etc) but there will be slight
differences depending on the size of the company, their experience and
other details.

Below is a brief guide to some of the service fees that you are likely to find on your fulfilment bill:

Warehouse preperation

Some fulfilment houses may charge you for any initial work that needs
to take place before they store your goods. This is usually the case
when you require things like specialist racking or staff must be trained
on how to handle your product.

Storage space

Most fulfilment companies charge per pallet, or per sq ft of space
your products take up. Look out for minimum order terms, where you may
be charged for the price of a whole pallet even if your stock only takes
up half.

Inventory/account management systems

These charges are pretty self explanatory, as they cover the
management of your account, i.e. when you receive additional services or
support, or detailed inventory information. It might not show up as a
separate charge as some companies bundle it with other fees.

Packaging fees

You will be charged for any additional packaging services your
fulfilment company provides, as well as any specialist hand enclosing
and finishing procedures that you need.

Although this is only a very brief guide on what kinds of charges you
can expect to find when partnering up with a fulfilment company, there
are still plenty more services that individual companies can provide, so
ask if a complete price guide is available so you can pick and choose a flexible ecommerce fulfilment service that’s right for you.

If you’re still feeling a little shell shocked after the run up to Christmas 2013 then now is the
time to take a step back and reassess the state of your fulfilment
house. With most of the post-Christmas January sales out of the way, it
is the perfect time to fix any problems that occurred during or just
after the Christmas rush.

Tidy up your fulfilment house

With such huge volumes of stock, and employees and temporary staff
working flat out to pick orders ready for their next day or even same
day deliveries, there are likely to have been several casualties as far
as floor organisation are concerned.

It’s a big task, so approach it methodically to ensure that every
square inch of your warehouse has been covered and that everything is
put back in its rightful place. Take a handful of your long term
employees—those who know the place like the back of their hand—and ask
them to reorganise and tidy the floor, de-cluttering and keeping an eye
out for any potential health and safety issues as they go.

Check everything’s in working order

A lot of your fulfilment services
will run through automated machinery and will have been pushed to
breaking point in the run up to Christmas, with hundreds of extra orders
being processed.

Use the quiet period to have all the machines thoroughly examined and
checked for wear and tear. This also goes for other equipment big and
small, such as pallet trucks or even hand held scanners, as fixing or
replacing any equipment now will avoid problems during busy periods in
the future.

Maximise organisation

During the busiest times, what parts of your warehouse management
system worked well and which did not? Was everything clearly labelled
and signposted to help new employees fulfil orders with ease? Ask your
staff for feedback and find out where improvements could be made.

It’s easy to become too relaxed in the post-Christmas months –
everyone wants to enjoy the lull. While taking a break and
congratulating yourselves for a job well done is important, reorganising
early on can only help make your company be the best possible for the
coming year.

Last week we looked at Network infrastructure strategies that support
same day delivery. This week we look at ways to manage personnel
towards the same goal.

Labour Deployment

Now that we have our SKU ducks in a row and accessible, we need to
address how to get it where it needs to go in the next few hours.
Proponents of ‘lean’ logistics counsel that the ‘drumbeat’, the pace of
logistics should be set by the customers. All too often that isn’t
possible in practice. Distribution centres seem to have more of a say in
release schedules, in the interest of efficiency and costs. Most such
facilities are set up for only one release per shift, or even per day,
in order to allow several picks for each location in the same trip. This
entire concept has to be scrapped if you want to commit to same day
delivery. It just will not allow the kind of response time you need.

At a minimum, you’ll need to have several releases per shift. You may
have to commit to dropping orders in real time, depending on the
specific needs of your business. Real time dropping is a big deal. It
means a heavy reorganisation, and can, frankly, meet with a lot of
psychological resistance from managers and workers alike. Getting a
proper, meaningful buy-in is key. That having been said, the changes
that allow for much faster pick cycles can lead to substantial gains in
efficiency in practice, as it outlines inefficiencies and warehouse
layout problems very clearly.

You may need to look at strategies such as zone picking,
or make your slotting strategies more efficient to the new order as
well. Some businesses could profit by increasing warehouse automation,
but this can increase employee stress, so make sure you don’t have your
pickers scuttling about to the angry beeps of inflexible machines. That
just leads to losing good people.

So the final question is: Is it worth doing all that to move to same
day delivery? For some operations, it is not. For those whose customers
demand it, though, it will become necessary, because your competitors
will be doing it already.

There are three main types of transportation in the fulfilment
industry that will get your goods where they need to go, or enable them
to be imported from other countries: vehicle, shipping and air freight.

Although transporting goods via shipping is arguably the most popular
way to move goods internationally, and road vehicles preferred where
local delivery is concerned, air freight has distinct advantages in the
overall speed of international delivery, as well as short haul local
flights that cover large distances in a matter of hours.

Fulfilment houses that have been strategically placed next to major
airports are often sold to clients on their ability to transport goods
faster due to the proximity of air freight services.

But does being close to a major airport really make that much of a difference to the global supply chain?

When cargo arrives at an airport, it needs to be transported to the
correct fulfilment house for unpacking, sorting and storing. Fulfilment
houses that are near to a major airport can dramatically reduce the
amount of time it takes for goods to reach the warehouse.

It also helps to reduce the amount of time goods spend travelling on
the road, or sitting idle in busy traffic, which in turn helps to lower
vehicular carbon emissions. A company actively pursuing greener fulfilment services appeals to many of today’s environmentally conscious business owners and consumers.

A fulfilment house that has experience with air freight can also
advise you on how to lower your overall costs. Insurance premiums for
air freight are generally lower as security levels tend to be high, and
even product packaging can be reduced as less is needed to secure goods
during a flight.

Overall, having an airport nearby that deals with international
imports and exports can save you money, as well as reducing the amount
of time the goods spend on the road. It speeds up the time it takes for
goods to come from the manufacturers to the fulfilment house, where it
can be processed ready for the end customer.

If you’d like to discuss joining Fairway Fulfilment & Logistics then just contact us to find out more about our complete fulfilment solutions.

Unrivalled online retailer Amazon.com recently obtained a patent for
“anticipatory shipping” and announced its plans to launch a system that,
if successful, would dramatically shorten its customer order fulfilment.

So just how can Amazon anticipate customers purchases?

Amazon has used large amounts of consumer information that it has
gathered over the years to create a database of its customer’s buying
habits. This data will enable them to anticipate products that their
customers will want to buy and have the items picked and packed before
they have even been ordered.

They will then be stationed in warehouses, and apparently on some occasions, actually in delivery trucks waiting for the green light before being delivered to the customer.

It’s an interesting and unnerving thought for many consumers – on the
one hand, the promise of even faster delivery is a positive aspect.
Same day delivery is available for a lot of products, but not all, and
usually not for large or unusual purchases.

Yet one of the negative sides is that Amazon is gathering information on consumers, often without their knowledge.

The company collects the information through a customer’s previous
orders, searches and wish lists as well as monitoring how long a
customer hovers over a certain item with the mouse.

Many have pointed out that essentially ‘guessing’ what customers want
could lead to unwanted deliveries and huge losses in profits, but
Amazon insists that such occasions would simply be a gesture of
goodwill.

Order fulfilment is one of the biggest parts of the global supply chain,
both financially and logistically. It requires a monumental team effort
and even the smallest of mistakes can have a knock on effect, costing
companies time and money.

With the new patent, other retailers and distributors will have to
step their game up where order fulfilment is concerned if they are to
keep up with Amazon’s anticipatory shipping.

Although no one is sure when Amazon is planning to launch its new
system, it will be testing it out in the U.S to see how it fares before
rolling it out to other countries. But whether this will encourage other
big retailers to follow in their footsteps is difficult to say.

Today, I’d like to share with you a case study of a young woman who would not be where she is today without a quality fulfilment partner for her home business. Her name has been changed for the sake of privacy, but let’s call her Lily.

She felt like she was missing out on her children’s lives at her 9 to
5, so she left her job in the banking industry to sell toys from home.
At the time, her daughter was only five, and her love for both
traditional and educational games inspired her mum.

Lily started a small online store to sell high quality children’s
games, at first just to her friends and neighbours, but eventually to a
growing clientele. “I always used my daughter to choose the products,
and my customers were always happy with her choices.”

“I only wanted to have the freedom to pick my daughter up from school. I never knew the business could become so successful.”

Several years on, Lily has launched her toy shop on a major online
facility’s site, and she needed a dedicated fulfilment house to handle
the much greater volume of business she was suddenly doing.

“For the first time in what feels like years, I have time for the
things that matter to me, and to grow my business as well. I’d never go
back to the old way of doing things.”

With her fulfilment partner handling all the warehousing and order
processing, Lily’s business was finally not crowding her out of her own
home. As a toy store, she did fully half her sales leading up to
Christmas. “By November, we could barely move for the stock we had to
keep in the office”. Better still, the increased capacity lets her make
enough sales to improve her lifestyle substantially. Lily says that her
success is nothing compared to the joy she has being a full time mum on a
full time businesswoman’s salary.

Last week we looked at ways to manage your inventory to achieve the
current holy grail of fulfilment, same day delivery. This week we will
examine network infrastructure, and how you can get everything where it
needs to go in time.

There are two basic strategies you can follow, depending on the 3V
analysis in the last installment. If you have a high 3V product, you can
use a single warehouse model. This makes your logistics and supply
chain simpler than the multiple-warehouse option, but requires you to
commit to somewhat expensive freight options to your more distant
customers. This model only really works well if your customers are
clustered in major cities which are in the same general area. Again,
luckily for England the bulk of most nationwide business’ customers are
in the South, or close to it. The freight expense will generally be
lower than the cost of the extra warehouses or fulfilment partners, as well.

Same day deliveries and multiple distribution points

The other model is for multiple distribution points, all allowing
same day delivery to any customer from at least one location without too
much expense. This is the necessary solution for relatively low 3V
goods, especially bulky products worth less per kilo, and not suited to
being hurried from London to Edinburgh before 3 pm for an extra £10
shipping cost. Of course, this can be expensive in terms of
infrastructure. You also have to keep stock on hand at all your
locations/3PLs. Nonetheless I know a tyre wholesaler in Yorkshire that
makes a tidy profit getting orders out to everywhere from Wales to
Scotland on the same day with a multiple warehouse model, so it can be
done.

Modelling software can help you spot the tipping point between
strategies for any one SKU, but askilled fulfillment partneris the real
key. Ask what they can do, and how fast they can do it. You won’t be the
first to explore same day options. Let’s hope you’re not the last.

With large international companies like Amazon experimenting with same day delivery, merchants and fulfilment companies need to cooperate to compete.

First things first: to get a product delivered on the same day it is
ordered, the product has to be in stock and within an 8 hour journey of
its destination. England is in a better position than may countries, as
even a good bit of Scotland is an 8 hour lorry ride from the London, and
fully 1/3 of the population is clustered in the Southeast alone.
Companies pioneering this strategy in the US or mainland Europe have to
stock a lot of extra inventory along a network of warehouses, making it
much more expensive.

Things to consider for your same day deliveries in order fulfilment

But having the stock (relatively) near the customer is not enough.
Inventory management practices have to be up to the task as well. 3V
analysis (stratifying stock keeping units ‘SKUs’ by their Value, Volume
and Velocity) and developing different strategies for each strata is the
key.

High 3V SKUs

These have relatively high value, volume and velocity, and are prime
items to consider offering same day delivery for. The sales volume means
that the effort gone to making sure you have sufficient stock on hand
for same day delivery won’t go to waste, and the relatively high unit
value means that customers are more likely to spring for faster
delivery.

Mid 3V SKUs

SKUs that are relatively low in volume or velocity will require more
investment and more risk to reliably offer same day delivery for. You
may want to think twice before offering the option for these unless the
value figure is very high indeed. If it is, then it may still be
profitable to offer same day service using a more expensive
transportation strategy, perhaps a special courier or some other option,
depending on the product.

Low 3V SKUs

Frankly, offering same day delivery on these items will usually cost
too much to be practical. Unless you plan to recoup the losses based on
reputation gains or centering ‘same day service’ in your marketing
strategy, you’d have to charge quite a lot for the service to avoid
taking a loss, and the take-up rate might not support it.

This stratification exercise should help you determine which SKUs you
can expect to profit from with same day delivery, and whether there is a
future in the practice for your business.

In the industry of order fulfilment services, response handling
is the term for any reply or action taken when a customer responds to
materials provided by your business. Fulfilment houses often provide
this as an extra support service alongside standard fulfilment jobs such
as pick and pack, storage and distribution.

What does response handling actually entail?

Response handling can fall under many categories, from taking
customer calls and answering queries, to sending out emails, SMS
messages and even brochures or promotional material.

But response handling also includes several other aspects of
fulfilment, whether it’s taking the initial customer orders online,
inputting credit and debit card information over the phone or even
picking and packing marketing materials and delivering it straight to
the customer.

Dealing with all your business response handling in-house can take up
a lot of time, particularly during busy holiday periods or during
promotional giveaways and any competitions you might be hosting.

Fulfilment houses, such as Fairway Fulfilment &
Logistics, that offer a dedicated response handling team can do many
things to help with this particular side of your business. They
can even set up and maintain a complete customer database using
information obtained from coupons, competition entries and any other
material returned by customers.

This information can be invaluable. It enables you to get to know
your customer base better than ever before and enables you to send out
advertising and promotional material directly to customers who have
already expressed an interest in your brand.
With the technology available to fulfilment companies today, it is
easier than ever to deal with response handling in a fast, effective
way. Response handling through the internet has enabled customers to
receive specific product information and responses to their queries
faster than ever.

This is important because it keeps the momentum of the sale going –
if a customer sees something they like in your virtual store but they
have a question about the product, delivery times or return policy,
getting a response back to them in a week is no good.

Today’s consumers expect a fast turnaround, both with their queries
and with their products, and are more likely to return to a retailer who
can provide both.

If you’ve not already made the jump from the traditional high street
retail shops to online ecommerce, then you’re already trailing behind
the vast number of established retailers and new start-ups that are
benefitting from this change.

Ecommerce is growing every year as more and more people change their
shopping habits, buying everything from luxury goods to everyday
essentials online.

Technology has played a big part in the success of ecommerce – the
very nature of its platform, the ever expanding internet, has given
retailers the freedom and flexibility to maximise their profits by
building on their brand in a completely virtual setting.

Ecommerce fulfilment for your online shop

But of course there are certain aspects of ecommerce that will be
different to a traditional high street store, and as technology adapts
and changes to meet our busy lifestyles, so must the way businesses
engage in ecommerce fulfilment.

One of the first things to consider is the way you present your
products to your customers. When shopping online, your customers won’t
have the opportunity to see the products close up, so it’s your job to
provide as much visual detail as possible.

One of the best ways to do this – and it’s also on the increase on
many ecommerce sites – is to have a combination of both pictures and
videos of the product.

Internet video platforms such as YouTube have changed the way we view
things online and creates an interactive environment for customers;
online clothing retailers for example could have a virtual catwalk in
order to show off their best pieces.

This small addition to the way you sell items online can help to
create brand loyalty and even reduce tricky and costly ecommerce
returns.

Once you’ve maximised your virtual shop window, it’s time to concentrate on getting the products safely to your customers.

If you’ve outsourced your ecommerce fulfilment to a professional fulfilment company, like Fairway Fulfilment & Logistics
then they should be able to integrate their ordering system with yours,
allowing you and customers to check the delivery statuses of goods in
real time, even on the go with specially designed Smartphone or tablet
apps.

In the fulfilment industry,
picking and packing items before they are distributed to customers is a
large and often complex procedure. This is especially true when certain
products or materials can’t be fully packaged by automated machinery
and require hand finishing and enclosing.

Though a particular product might need a little more hands on care
before being distributed to customers, in the case of marketing, hand finishing can actually help your brand reach a greater number of people.

Not only that, but with such massive volumes of different products
requiring hand finishing and enclosing every day, it’s a vital part of
the fulfilment industry and one that can effectively boost sales, brand image and positive customer feedback.

With a combination of automatic machinery and trained hand finishing
staff, orders reaching into the thousands can be completed and
distributed within a matter of days. Some examples of how this might
benefit your business include:

Magazine inserts

Advertising space is lucrative in the magazine industry, particularly
inserts which are geared towards the magazine reader. With the numbers
of many print magazines running into the thousands and monthly or weekly
deadlines to meet, such a big task requires a large hand finishing team
working round the clock.

Flat-pack packaging assembly

Bespoke packaging or promotional presentation boxes can be assembled
quickly and efficiently by hand, which is great for sending out consumer
incentives, or changing packaging to fit in with a seasonal theme, i.e
Christmas.

Permanent and peelable gluing

Promotional material that needs to be securely fixed to a product can
be sprayed with a concentrated amount of glue, which hand finishing
personnel can then use to attach materials or heavy items, such as free
samples.

Other delicate jobs such as carton strapping and labelling can also
be done using a combination of specialist hand finishing personnel and
automated machinery, with quality control and regular spot checks in
place to ensure there are no mistakes.

There are many other ways in which a fulfilment house, like Fairway Fulfilment & Logistics
can help with hand finishing and enclosing needs. By offering a
flexible and personal approach to your business’ requirements, a
fulfilment house can help you with even the smallest of details – which
tend to have the biggest impact.

The point of sale, or POS, is the moment your
customer completes their purchase of a product. In a bricks-and-mortar
store, this would be at the till. Online, it’s would be the point where
the customer clicks on the ‘confirm order’ button.

Consumers are switching to online purchases for almost every
essential and non-essential purchases in their lives; they can do the
grocery shopping from the comfort of their own homes, order that
complete DVD box set they’ve been after for months, or even finish all
their Christmas shopping on time and in one sitting.

How can POS management systems assist your business?

The most immediate benefits of integrating a POS management system to your own online store
is the ease with which customer orders can be picked up and processed,
with a receipt confirming the purchase automatically sent back to the
customer.

Then from the POS system, your customer’s order can be picked, packed and ready for delivery.

POS management software available in fulfilment houses today doesn’t just streamline order fulfilment;
it can also be used to effectively process returns, which can be
credited back to your account and made available for reordering.

It can also organise your inventory at the click of a button, and
it’s all stored safely ready for you to look at when you need to. Stock levels can be managed
more easily and can even alert you to low levels of stock, meaning you
can replenish popular items and not miss out on potential sales.

Similarly, sales and promotional discounts can be monitored and tracked on a large scale. Trends in sales can be analyzed even when you’re not on the premises.

It can also be an effective tool in marketing. Data from customer credit cards can provide you with invaluable details when advertising your brand or sending out incentives.

Overall, a professional fulfilment house that provides POS management
software will make your life (and your overall sales) much smoother,
with streamlined inventory management and a quick point of sale your
customers will really appreciate.

What is it that first attracts new clients to a fulfilment house?
A recommendation via word of mouth from another business owner? A
snazzy website loaded with pictures, testimonials and blogs? Or perhaps a
bit of both?
Although recommendations and a professional appearance are important,
a new client will sift through the available fulfilment houses and
ultimately choose the one that provides the order fulfilment services they need.

So it’s worth asking yourself: just what order fulfilment services can you offer potential clients?

A lot of small fulfilment houses offer the standard pick and pack alongside a few other services that clients can take advantage of. Yet if you have the means to take on extra order fulfilment duties, then it can really help your company stand out from the crowd.

What you should avoid, however, is trying to create a ‘complete’
package that just isn’t. Outsourcing seemingly smaller jobs like taking
telephone orders or handling complaints and queries may at first seem
like a good idea – lowering costs for all parties involved and freeing
up your employees’ time – it can and probably will backfire, angering
your client’s customers, your client, and seriously damaging your
reputation.

Instead offer services that are designed to meet both your client’s
needs and your capabilities: i.e. don’t try to take on too much too
soon. Being flexible and listening to a client can often tip the scales
in your favour, particularly when dealing with a start up business, or
companies who may have previously done all their fulfilment services
in-house.

Small order fulfilment changes can often go a long way.

Could you introduce a call centre designed specifically to handle complaints? Or offer a simplified returns policy that will help customers and keep them happy? How about investing in the latest data analysis and reporting software, which allows client’s to remotely check their stock levels or even get alerts before problems arise?

If you can offer your client the whole package – an entire order fulfilment service, like Fairway Fulfilment & Logistics,
that starts with receiving their goods and ends with a satisfied
customer – then you are far more likely to build lasting business
relationships as well a sterling reputation.

As we get stuck into January and deal with the increasingly unstable
weather sweeping the nation, many personal New Year’s resolutions will
have been made, and some even kept, with plenty more that didn’t quite
make it past the third day.

In the fulfilment industry, the New Year can be a
great time to take a fresh look at the industry as a whole and stir up
new ideas and solutions for a rapidly changing environment.

For business owners, it could potentially be the start of their
company’s expansion into new territories, grabbing the attention of new
customers and maintaining their relationship with regulars.

For 2014, instead of a personal one, why not make a business
resolution that you can stick too, like aiming to make this the year
that your get your e-commerce up and running, or creating and implementing an effective marketing campaign to encourage new customers?

With the help of professional fulfilment services, it’s easier than you think

If you’ve never thought about outsourcing your order fulfilment before now, it’s a great time to start looking around and finding a provider that can help you and your company.

If you were testing the water with a temporary fulfilment services
solution during the run up to Christmas last year, did you see big improvements in sales, customer feedback and the overall efficiency of your supply chain? If so, extending your fulfilment services contract could be the best thing you do this year.

Fulfilment houses can help you with almost every aspect of the supply
chain, from packaging and distribution to customer service and returns.
They can offer you flexibility, either taking on a just one part, or
your entire order fulfilment.

There’s also room for promotional marketing, with in-house teams
working round the clock to hand finish and enclose materials designed to
advertise your brand and increase sales.

Make this the year that you take a leap and resolve to maximise the
potential of your company. With the right marketing and order fulfilment
services working alongside you, there’s never been a better time to
grow.

If you haven’t already, take your retail business online into the world of e-commerce, where competition is fierce but an excellent order fulfilment service can help swing customers around in your favour

Sometimes working with a fulfilment house for a short amount of time
like this can show you just how indispensable it could be for your
business.

Rewarding consumer loyalty is one of the simplest
and most effective ways to imprint your brand on the minds of your
customers. They often feel that their loyalty is appreciated and are more likely to purchase something from you in the future.

From collecting points that customers can update and manage online to
free gifts or bespoke promotional merchandising, having a rewards and
loyalty scheme in place can massively increase brand awareness and
encourage customer loyalty.

Some order fulfilment companies
deal directly in the procurement and delivery of non-monetary rewards
and loyalty gifts, while others may treat your loyalty stock as simply
another product to be distributed.

But how could an order fulfilment company help you to reward your loyal customers?

By storing and dispatching goods intended for reward schemes using
the same systems that deliver your stock directly to your customers.

And that’s not all. If your company hosts regular consumer competitions or prize giveaways, then using an order fulfilment company to package and send out the prizes can effectively take that job out of your hands while you reap the benefits of consumer opinion.

Although this is hugely beneficial where customers are concerned,
it’s not just your brand and the consumers who love it that could reap
the benefits of a reward scheme. Your employees can too.

Rewarding employees is a great way to both motivate staff and to say
thank you for all their hard work. Once only given out to employees
after periods of ten or more years of service, rewards and incentives
play a huge part in today’s businesses.

Individual incentives can encourage employees to beat targets and
maximise productivity, while team incentives are a great way of building
and rewarding efficiency and teamwork.

If you have a small company that operates from one building or a
single city, this might seem unnecessary. But for large companies with
thousands of employees across the globe, a fulfilment house can distribute non-monetary rewards to them quickly and safely.

So maximise your relationships with your customers and your
employees; advertise and promote your brand whilst giving something
back. The items don’t have to be expensive, and are usually a fraction
of the cost of an entire advertising budget and usually just as
effective.

If you would like to discuss the various options available from a
fulfilment house you can trust to handle your loyalty products and other
order fulfilment services, contact Fairway Fulfilment & Logistics on 01753 588469 and let us show you how we can help.

Hand finishing and enclosing is a fairly self explanatory process in the fulfilment industry,
even if it isn’t always a simple operation. Bespoke packaging for
physical products or marketing campaigns that are too delicate or
complicated to be machine packaged are finished off by hand and
delivered directly to your customers.

It is a fantastic way to reach your customer base and encourage general interest. While hand finishing and enclosing
is used mainly for distributing promotional material to your end users,
it can also provide unique and even fun extras that will really
surprise your customers.

Promotional materials such as personalised letters or vouchers for
money off future purchases targeted directly at one time or regular
customers can in fact push sales – and profits – through the roof, while
an effective marketing campaign targeted at new customers (think free
samples) can increase brand awareness.

Hand finishing and enclosing fulfilment services – is it expensive?

Thinking that high cost might be an issue? With competitive rates and
professional handling, it is one of the best forms of direct marketing
out there and you could potentially reap the rewards in a very short
time.

Hand finishing and enclosing is a big job, which is
why few fulfilment houses offer this incredibly valuable extra. You
could try and do it on your own, planning a streamlined conveyer belt of
hands to sort through 50,000 envelopes and marketing material, but why
hire all the extra staff and lose time and space doing something a
specialist fulfilment house could do?

Most fulfilment houses that offer this service will have a dedicated
team working around the clock to fulfil huge volumes of orders that
require hand finishing and enclosing.

Many of these hands on jobs include assembling flat pack gift boxes,
placing inserts or free samples into envelopes and even sticker
applications, although every company is different and are likely to have
their own ideas and concepts.

A professional fulfilment house specialising in hand
finishing and enclosing should be able to adapt to your companies
requirements, offer support and help during the process and deliver
outstanding results by the agreed deadline. If you are looking for an
order fulfilment company to assist with this type of work for your
business, call Fairway Fulfilment & Logistics on 01753 588469

One of the biggest customer complaints regarding deliveries of large
items is waiting in all day for delivery. There are cases where the item
in question fails to show up at the specified time or day. This can
infuriate customers who will have no doubt had to rearrange their
schedules in order to receive the items.

All over the internet there are comments and angry customer reviews
about having to take a half or sometimes even the whole day off work,
sending out ripples of disruption into other areas of the customer’s
life.

Recently there have been more and more companies, particularly from
some of the biggest names like The Royal Mail, who have extended their
delivery hours into the evening, from 6pm onwards, in order to cater for
people who work during the day. Fairway Fulfilment & Logistics can assist your business with ensuring customers receive their goods on time, call us today on 01753 588469 for more information.

Are evening deliveries more expensive?

Of course, such a quick delivery is going to cost more than a
delivery at any other time, as the pressure to have the item packed,
transported and delivered into the hands of the customer is greatly
increased. Even if goods are not being delivered on the same day,
evening deliveries will still incur higher costs due to things like
paying staff for working out of hours.

On the other hand, roads tend to be less congested at night, although
there can be heavy traffic in the early evening when people are coming
home from work. Customers who have chosen an evening delivery are more
likely to be at home to answer the door, reducing the extra work
required to return packages and send them out again for redelivery.

The benefit of offering evening delivery to your customers is hearing
their positive feedback at the end of it. Customers love flexibility
and providing a delivery method that won’t disrupt their daily lives is
something that can really help you to stand out from the competition.